Today's Presidential candidates try to distance themselves from corporate lobbyists. But investors might want to give them a big hug, say professors Hui Chen (University of Colorado), David Parsley (Vanderbilt), and Ya-Wen Yang (University of Miami). Focusing on direct lobbying by from publicly traded companies from 1998 to 2005 (when such expenditures totaled about $560 million), they created two stock portfolios: one with companies that lobbied actively, one with those that didn't. Over three years, the average annual return for intensely active companies was about 8% higher than for non-lobbying firms. Reasons ? Hui cites possible profit boosts from tax breaks or federal contracts. Why don't more outfits spend big on lobbying? That's a question "we're working on," says Hui.
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