We examine whether corporate money in politics benefits or hurts labor using the 2010 Supreme Court ruling Citizens United, which rendered bans on political election spending unconstitutional. In difference-in-difference analyses, affected states experience increases in both capital and labor income relative to unaffected states. We find evidence consistent with increased political spending spurring political competition and the adoption of pro-growth policies. These policies benefit a broader set of constituents as we find a broad-based increase in labor income. Affected states see increased political turnover and reduced regulatory burdens. The economic effects are stronger among ex-ante politically inactive and younger firms.
This event will be a hybrid event. The seminar will take place in Roeterseiland campus (REC) building M and will also be streamed online via Zoom.
Pat Akey is a visiting professor at INSEAD, Associate Professor at the University of Toronto and member of the European Corporate Governance Institute. His research focuses on the political economy of finance and the incentives of firms to engage in pro-social behavior. He has presented his research at numerous major academic and practitioner conferences and published in the Journal of Finance, the Journal of Financial Economics, and the Review of Financial Studies. He was awarded the 2021 Brattle Prize Distingushed paper for one of the best papers in corporate finance published by the Journal of Finance and the 2016 Rising Scholar Award for the best paper by a young researcher published in the Review of Financial Studies.
The Amsterdam Center for Law and Economics (ACLE) is a joint initiative of the Faculty of Economics and Business and the Faculty of Law at the University of Amsterdam. The objective of the ACLE is to promote high-quality interdisciplinary research at the intersection between law and economics.