Date of Award

12-2018

Degree Type

Report

Degree Name

Master of Science (MS)

Department

Economics and Finance

Committee Chair(s)

Ben Blau

Committee

Ben Blau

Committee

Tyler Brough

Committee

Todd Griffith

Abstract

The Honest Leadership and Open Government Act of 2007 (Pub.L. 110-81, 121 Stat. 735, enacted September 14, 2007) was passed by the U.S. Congress in order “to strengthen public disclosure requirements concerning lobbying activity and funding. It placed more restrictions on gifts for members of Congress and their staff, and provides for mandatory disclosure of earmarks in expenditure bills.” Treating this event as a natural experiment, we examine how this legislation affected the Cumulative Abnormal Returns (CARs) of firms that lobbied in the year(s) leading up to the passing of the legislation. We find that companies that lobbied in the years leading up to the legislation significantly underperformed the market in the days surrounding the passage of the legislation.

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