Using an international sample of firms from 28 countries, we document that there exists a negative relationship between political connections and the informativeness of stock price, as measured by idiosyncratic volatility (IV). This finding is robust to alternative regression specifications, sub-samples analyses, and concerns related to endogeneity. A more detailed analysis shows that out of the different types of possible connections, the connectedness of the owners is the primary driver of this result. Further, the negative association is only significant for firms in countries characterized by low institutional quality (corrupted countries, countries with low access to external equity markets, and countries with low media penetration). There is no evidence of any relation between political connections and stock price informativeness for firms in countries characterized by high institutional quality. Overall, our results show that although political connections exacerbate rent-seeking that weaken the firms’ information environment on average, the negative information consequences are compensated by the countries’ institutional quality.

使用来自28个国家/地区的公司的国际样本，我们证明，政治联系和股价的信息之间存在负相关关系（以特质波动率（IV）衡量）。这一发现对于替代回归指标，子样本分析以及与内生性相关的关注是可靠的。更详细的分析表明，在可能的连接的不同类型中，所有者的连接是此结果的主要驱动力。此外，负面关联仅对那些机构质量低下的国家（腐败的国家，无法进入外部股票市场的国家以及媒体渗透率较低的国家）的公司具有重要意义。没有证据表明，在具有较高机构质量的国家中，公司的政治联系与股价信息之间存在任何关系。总体而言，我们的结果表明，尽管政治联系平均加剧了寻租行为，从而削弱了企业的信息环境，但负面信息后果却被这些国家的制度质量所弥补。