Date of Award

5-2021

Degree Type

Report

Degree Name

Master of Science (MS)

Department

Economics and Finance

Committee Chair(s)

Tyler Brough (Committee Chair)

Committee

Tyler Brough

Committee

Todd Griffith

Committee

Ayse Sapci

Abstract

This paper examines the stock market reaction to banks that lobby relative to banks that did not lobby in the period around the November 9, 2016, U.S. presidential election. Using three different methods of event studies to calculate the cumulative average return, we find that lobbying in banks has a meaningful relationship to an abnormal increase in those firm’s stock prices. Then we attempt to control for both the systemic importance and size of these institutions by performing cross-sectional regressions that include matched size, and the systemic nature of the banks. The results suggest that a heavily regulated industry such as banking, can see a noteworthy impact from a strong lobbying strategy.

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