Purpose

This paper examines the effect of political connections (PCs) on firms' profitability and market value in the Egyptian market after the uprising of 2013.

Design/methodology/approach

An empirical study is conducted based on 284 firm-year observations for non-financial listed firms on the EGX100 during the period of 2014–2017. To test the study’s hypothesis, two independent sample t-test, Pearson correlation analysis and ordinary least square (OLS) regressions are conducted.

Findings

The results suggest that PCs are common across all industries in Egypt, the PCs through top officers do not improve firm's profitability; however, it has a positive effect on firms' market value. Further, PCs through business owners improve neither profitability nor the market value. Finally, the results suggest that PCs through government ownership have a positive effect on both firms' profitability and market value.

Practical implications

The study’s finding encourages policymakers and regulators in emerging markets, e.g. Egypt, to develop stricter laws, policies and regulatory initiatives to restrain the potential conflict of interest in the politically connected firms.

Originality/value

To the best of the authors' knowledge, this study is one of the first to examine the relationship between PCs and both firms’ profitability and market value in Egypt.

中文翻译：

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政治关系对公司业绩的影响：来自埃及的证据

目的

本文研究了政治关系 (PC) 对 2013 年埃及起义后埃及市场公司盈利能力和市场价值的影响。

设计/方法/方法

一项实证研究基于 2014-2017 年期间 EGX100 上非金融上市公司的 284 家公司年度观察结果。为了检验研究的假设，进行了两个独立样本t检验、Pearson 相关分析和普通最小二乘 (OLS) 回归。

发现

结果表明，个人电脑在埃及的所有行业中都很常见，通过高级管理人员的个人电脑不会提高公司的盈利能力；然而，它对公司的市场价值有积极的影响。此外，通过企业主的个人电脑既不会提高盈利能力，也不会提高市场价值。最后，结果表明政府所有制的个人电脑对两家公司的盈利能力和市场价值都有积极的影响。

实际影响

该研究的发现鼓励新兴市场（例如埃及）的政策制定者和监管机构制定更严格的法律、政策和监管举措，以限制政治相关公司的潜在利益冲突。

原创性/价值

据作者所知，这项研究是最早研究 PC 与埃及两家公司盈利能力和市场价值之间关系的研究之一。