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Political connections: Evidence from insider trading around TARP

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dc.contributor.author Akin, Ozlem
dc.contributor.author Coleman, Nicholas S.
dc.contributor.author Fons-Rosen, Christian
dc.contributor.author Peydró, José-Luis
dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
dc.date.accessioned 2020-05-25T09:27:04Z
dc.date.available 2020-05-25T09:27:04Z
dc.date.issued 2016-10-01
dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=1542
dc.identifier.citation Akin O, Coleman NS, Fons‐Rosen C, Peydró J‐L. Political connections and informed trading: evidence from TARP. Financ Manage. 2021;50(3):619-44. DOI: 10.1111/fima.12292
dc.identifier.uri http://hdl.handle.net/10230/27418
dc.description.abstract We exploit the 2008-2010 TARP bank bailouts after Lehman s failure to test for private information leakages from banking regulators to top corporate bank executives using insider trading data and information on political connections. In politically-connected banks, buying during the pre-TARP period is associated with increases in abnormal returns around TARP. For unconnected banks, insider trading and returns are uncorrelated. Results hold when comparing connected to unconnected executives within the same bank and are driven by political connections to financial branches of government. Through a FOIA request we obtained the previously unknown TARP funds requested by each bank. The ratio of requested to received funds strongly correlates with abnormal returns and is also a predictor of buying behavior by connected banks.
dc.format.mimetype application/pdf
dc.language.iso eng
dc.relation.ispartofseries Economics and Business Working Papers Series; 1542
dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.title Political connections: Evidence from insider trading around TARP
dc.title.alternative
dc.type info:eu-repo/semantics/workingPaper
dc.date.modified 2020-05-25T09:25:03Z
dc.subject.keyword political connections
dc.subject.keyword political economy in banking
dc.subject.keyword insider trading
dc.subject.keyword tarp
dc.subject.keyword bank bailouts
dc.subject.keyword Business Economics and Industrial Organization
dc.subject.keyword Finance and Accounting
dc.subject.keyword Labour, Public, Development and Health Economics
dc.rights.accessRights info:eu-repo/semantics/openAccess

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