Federal Election Commission ( CU) in January 2010 represents the most dramatic change in corporate campaign financing since the Taft-Hartley Act of 1947.
Supreme Court's landmark decision on Citizens United vs. We do not find any significant crowding-out effects of independent political expenditures on lobbying activity, executive contributions, and political action committees (PAC) contributions. Overall, our evidence supports the hypothesis that independent political spending crowds out political connections. After the ruling, firms headquartered in states where bans are lifted have fewer state-level connections relative to firms in other states. To evaluate the effect of Citizens United on corporate political activism, we explore the fact that Citizens United also lifts bans on independent political spending in states where such bans existed. The estimates suggest that the value of a political connection decreases by $6.9 million. Politically connected firms have lower announcement returns at the ruling than non-connected firms. The decision opened the door for corporate treasuries to engage in independent political spending. This paper analyzes the effect that the U.S.
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