Who Pays a Visit to Brussels? The Firm Value of Cross-Border Political Access to European Commissioners

44 Pages Posted: 27 Mar 2019 Last revised: 29 Oct 2020

See all articles by Kizkitza Biguri

Kizkitza Biguri

Oslo Business School - OsloMet

Jörg Stahl

Católica Lisbon School of Business & Economics

Date Written: July 1, 2020

Abstract

We present novel evidence on the value of cross-border political access. We analyze data on meetings of US multinational enterprises (MNEs) with European Commission (EC) policymakers. Meetings with Commissioners are associated with positive abnormal equity returns. We study channels of value creation through political access in the areas of regulation and taxation. US enterprises with EC meetings are more likely to receive favorable outcomes in their European merger decisions and have lower effective tax rates on foreign income than their peers without meetings. Our results suggest that access to foreign policymakers is of substantial value for MNEs.

Keywords: Cross-border political access, European Commission, firm value

JEL Classification: D72, G30

Suggested Citation

Biguri, Kizkitza and Stahl, Jörg, Who Pays a Visit to Brussels? The Firm Value of Cross-Border Political Access to European Commissioners (July 1, 2020). LawFin Working Paper No. 9, Available at SSRN: https://ssrn.com/abstract=3339871 or http://dx.doi.org/10.2139/ssrn.3339871

Kizkitza Biguri

Oslo Business School - OsloMet ( email )

P.O. Box 4
Oslo, 0130
Norway
+47 46410566 (Phone)

HOME PAGE: http://sites.google.com/site/kizkitzabiguri/home

Jörg Stahl (Contact Author)

Católica Lisbon School of Business & Economics ( email )

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