We use novel hand-collected data on political connections to find politically connected firms earn more positive (less negative) Cumulative Abnormal Returns (CARs) than those without political connections as a response to favorable (unfavorable) macroeconomic news. Using the...

The conflict of interests between controlling and minority shareholders is an important issue in firms with concentrated ownership. We document that the controlling shareholders' expropriation behavior through tunneling or self-dealing is much severer in politically connected firms. The results...