THE PRICE OF POLITICAL CONNECTIONS

• 영문명: THE PRICE OF POLITICAL CONNECTIONS
• 발행기관: 한국재정학회(구 한국재정·공공경제학회)
• 저자명: 백승연(S. Youn Baek)
• 간행물 정보: 『한국재정학회 학술대회 논문집』2018년도 추계학술대회 논문집, 1~14쪽, 전체 14쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 2018.10.30

영문 초록

This study examines the stock valuation of politically connected firms that were involved in 2016 South Korean political corruption scandal. Contrary to prior literature, this paper finds that having political connections is associated with negative firm value measured by Tobin’s q. The negative effect is not observed before President Park Geun-hye, the key suspect of this scandal, took office. Although this result can be driven by unobserved political risks that happened to coincide with Park’s incumbency, cumulative abnormal return of connected firms rose significantly after she was impeached in the Constitutional Court and does not change for a set of other important political events. This result implies that the value of political connections estimated in the previous research could have been overestimated as they do not account for the price of political connections depending on the nature of political ties.

목차

1 Introduction

2 Political connections in the long run

3 Political connections in the short run

4 Determinants of political connections

5 Conclusion

6 References

키워드

political connections firm valuation rent seeking