The Influence of Political Connections on the Cost of Capital and the Performance of Companies Listed on B3
The theory holds that in emerging economies, such as the Brazilian one, companies seek to strengthen ties with governmental and institutional actors in order to improve their performance. From the theoretical perspective of the Institutional Theory, this study intends to contribute to previous resea...
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FUCAPE Business School
2018
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oai:doaj.org-article:64fe665590eb426da796e8ce9087b02c2021-11-11T15:48:07ZThe Influence of Political Connections on the Cost of Capital and the Performance of Companies Listed on B31807-734X10.15728/bbr.2018.15.4.1https://doaj.org/article/64fe665590eb426da796e8ce9087b02c2018-01-01T00:00:00Zhttp://www.redalyc.org/articulo.oa?id=123056181001https://doaj.org/toc/1807-734XThe theory holds that in emerging economies, such as the Brazilian one, companies seek to strengthen ties with governmental and institutional actors in order to improve their performance. From the theoretical perspective of the Institutional Theory, this study intends to contribute to previous research, integrating the fields of strategy and finance, investigating the influence of political connections, through campaign donations, the cost of capital and the performance of listed companies on B3. We worked with panel data for data analysis on the period ranging from 1998 to 2016. Our findings do not corroborate the theoretical and intuitive prediction that “crony capitalism” reduces the cost of capital and improves the performance of companies, since we did not obtain empirical evidence that allows affirming that the effect of donations on the cost of capital and the performance of connected companies is different from zero.Jaison Caetano da SilvaWlamir Gonçalves XavierCinara GambirageSilvio Parodi Oliveira CamiloFUCAPE Business Schoolarticlecost of capitalperformancepolitical connectionscampaign donationscorruptionBusinessHF5001-6182ENPTBBR: Brazilian Business Review, Vol 15, Iss 4, Pp 317-330 (2018) |
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| collection |
DOAJ |
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EN PT |
| topic |
cost of capital performance political connections campaign donations corruption Business HF5001-6182 |
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cost of capital performance political connections campaign donations corruption Business HF5001-6182 Jaison Caetano da Silva Wlamir Gonçalves Xavier Cinara Gambirage Silvio Parodi Oliveira Camilo The Influence of Political Connections on the Cost of Capital and the Performance of Companies Listed on B3 |
| description |
The theory holds that in emerging economies, such as the Brazilian one, companies seek to strengthen ties with governmental and institutional actors in order to improve their performance. From the theoretical perspective of the Institutional Theory, this study intends to contribute to previous research, integrating the fields of strategy and finance, investigating the influence of political connections, through campaign donations, the cost of capital and the performance of listed companies on B3. We worked with panel data for data analysis on the period ranging from 1998 to 2016. Our findings do not corroborate the theoretical and intuitive prediction that “crony capitalism” reduces the cost of capital and improves the performance of companies, since we did not obtain empirical evidence that allows affirming that the effect of donations on the cost of capital and the performance of connected companies is different from zero. |
| format |
article |
| author |
Jaison Caetano da Silva Wlamir Gonçalves Xavier Cinara Gambirage Silvio Parodi Oliveira Camilo |
| author_facet |
Jaison Caetano da Silva Wlamir Gonçalves Xavier Cinara Gambirage Silvio Parodi Oliveira Camilo |
| author_sort |
Jaison Caetano da Silva |
| title |
The Influence of Political Connections on the Cost of Capital and the Performance of Companies Listed on B3 |
| title_short |
The Influence of Political Connections on the Cost of Capital and the Performance of Companies Listed on B3 |
| title_full |
The Influence of Political Connections on the Cost of Capital and the Performance of Companies Listed on B3 |
| title_fullStr |
The Influence of Political Connections on the Cost of Capital and the Performance of Companies Listed on B3 |
| title_full_unstemmed |
The Influence of Political Connections on the Cost of Capital and the Performance of Companies Listed on B3 |
| title_sort |
influence of political connections on the cost of capital and the performance of companies listed on b3 |
| publisher |
FUCAPE Business School |
| publishDate |
2018 |
| url |
https://doaj.org/article/64fe665590eb426da796e8ce9087b02c |
| work_keys_str_mv |
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