The Political Polarization of Corporate America / Vyacheslav Fos, Elisabeth Kempf, Margarita Tsoutsoura.

Format:

Book

Author/Creator:

Fos, Vyacheslav.

Contributor:

National Bureau of Economic Research.

Kempf, Elisabeth.

Tsoutsoura, Margarita.

Series:

Working Paper Series (National Bureau of Economic Research) no. w30183.

NBER working paper series no. w30183

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2022.

Summary:

Executive teams in U.S. firms are becoming increasingly partisan. We establish this new fact using political affiliations from voter registration records for top executives of S&P 1500 firms between 2008 and 2020. The new fact is explained by both an increasing share of Republican executives and increased assortative matching by executives on political affiliation. Executives who are misaligned with the political majority of their team are more likely to leave the firm, especially in recent years, and their company's stock price responds negatively to the announcement of their departure. Combined, our findings indicate that the increasing political polarization of corporate America may not be in the financial interest of shareholders.

Notes:

Print version record

June 2022.