Title

The Effects of Congressional Elections on Future Equity Market Returns

Abstract

As the primary entity responsible for new legislation, Congress is capable of enacting legislation that may affect future market returns. To examine potential effects, the percentage of the House of Representatives and Senate controlled by a political party is examined. Additionally, the effect on returns in a change in the percentage of seats gained or lost in Congressional elections is analyzed. To test both theories, a modified “partisan view” model is adopted. Results point to the fact that equity markets perform better in situations in which power is distributed between political parties.

Department(s)

Economics

Second Department

Engineering Management and Systems Engineering

Document Type

Article - Journal

Document Version

Citation

File Type

text

Language(s)

English

Rights

© 2008 the Institute for Business and Finance Research IBFR, All rights reserved.


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