Theoretical Light in Empirical Darkness: Illuminating Strategic Concealment of Corporate Political Activity

53 Pages Posted: 16 Aug 2021

See all articles by Nan Jia

Nan Jia

University of Southern California - Marshall School of Business

Stanislav Markus

Moore School of Business (U of South Carolina)

Timothy Werner

University of Texas at Austin - Red McCombs School of Business

Date Written: August 13, 2021

Abstract

Law-abiding firms often attempt to conceal their corporate political activity (CPA), yet the concealment of CPA has not been matched by our understanding of the phenomenon. We develop a theoretical framework consisting of three components to analyze firms’ strategy of CPA concealment. First, we provide a detailed conceptual background on CPA concealment, including what concealment of CPA is and how it can occur. Second, we develop an in-depth analysis of the key benefits and costs of concealing CPA for firms. Finally, we integrate this analysis with positive political theory to place our firm-level calculus in the context of policymaking by identifying the public policymakers whom firms are most likely to influence via CPA concealment. Based on this framework, we generate additional empirically testable propositions on how CPA concealment changes with factors at the country, institution, issue, and firm levels. This study is the first to generate systematic theory on firms’ CPA concealment strategies. Moreover, this research context highlights the particular importance of theory for investigating consequential phenomena that yield scarce data – it is theory which guides data discovery ex ante, helps assess bias ex post, and uncovers key insights that empirical analysis alone cannot generate.

Suggested Citation

Jia, Nan and Markus, Stanislav and Werner, Timothy, Theoretical Light in Empirical Darkness: Illuminating Strategic Concealment of Corporate Political Activity (August 13, 2021). Academy of Management Review, USC Marshall School of Business Research Paper Sponsored by iORB, No. Forthcoming, Available at SSRN: https://ssrn.com/abstract=3904520

Nan Jia (Contact Author)

University of Southern California - Marshall School of Business ( email )

701 Exposition Blvd
Los Angeles, CA California 90089
United States

Stanislav Markus

Moore School of Business (U of South Carolina) ( email )

1705 College St
Francis M. Hipp Building
Columbia, SC 29208
United States

Timothy Werner

University of Texas at Austin - Red McCombs School of Business ( email )

United States
5122326844 (Phone)

HOME PAGE: http://timothywerner.com

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
128
Abstract Views
878
rank
298,526
PlumX Metrics