We define areas with strong geographic ties to powerful politicians as politically vibrant and show that they are characterized by greater value‐relevant information generation and symptomatic of equity market segmentation. Political vibrancy entails greater levels of local bias and local comovement and has two important return predictability implications. First, it enhances local institutions’ informational advantages; their trades’ ability to forecast local stock returns exceeds that of nonlocal institutions. Second, in support of the view that information diffuses slowly into prices, stock returns of firms from politically vibrant areas predict returns of similar firms in other areas.

中文翻译：

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政治活力的股票市场后果

我们将与强大的政治家具有紧密地理联系的地区定义为政治上充满活力的地区，并表明它们的特点是与价值相关的信息生成量更大，并且对股票市场进行细分。政治活力需要更大程度的地方偏见和地方合作，并具有两个重要的收益可预测性含义。首先，它增强了地方机构的信息优势。他们预测本地股票收益的交易能力超过了非本地机构。第二，支持信息缓慢扩散到价格的观点，来自政治活跃地区的公司的股票收益预测了其他地区类似公司的收益。