Political contributions and analyst behavior

Danling Jiang, Alok Kumar, Kelvin K F Law

Research output: Contribution to journalArticlepeer-review

24 Scopus citations


We show that the personal traits of analysts, as revealed by their political donations, influence their forecasting behavior and stock prices. Analysts who contribute primarily to the Republican Party adopt a more conservative forecasting style. Their earnings forecast revisions are less likely to deviate from the forecasts of other analysts and are less likely to be bold. Their stock recommendations also contain more modest upgrades and downgrades. Overall, these analysts produce better quality research, which is recognized and rewarded by their employers, institutional investors, and the media. Stock market participants, however, do not fully recognize their superior ability as the market reaction following revisions by these analysts is weaker.

Original languageEnglish (US)
Pages (from-to)37-88
Number of pages52
JournalReview of Accounting Studies
Issue number1
StatePublished - Mar 1 2016


  • Conservative analysts
  • Equity analysts
  • Forecasting style
  • Market reaction
  • Political contribution

ASJC Scopus subject areas

  • Business, Management and Accounting(all)
  • Accounting


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