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THE POWER OF SHAREHOLDER POLITICAL TRANSPARENCY ACTIVISM

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Abstract

Corporations have become frequent targets of shareholder activism that seeks to improve corporate political responsibility. This paper examines whether shareholder activism can increase the targeted firms' political risk and market uncertainty. Using a unique panel dataset on shareholder political transparency activism (SPTA) from 2000 to 2018, I employed the difference-in-differences method to estimate the causal effects of shareholder activism on corporate political and economic outcomes. The DID estimators show that shareholder political transparency activism can increase the targeted firms' political risk instead of market uncertainty.

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