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Inside the Beltway Advantage Do US Senators Exploit Information Privilege in Congress

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posted on 2024-05-15, 02:10 authored by Yiwei Li Li

I examine whether U.S. senators leverage their access to privileged information for personal financial gain. I use a vector space document modeling approach to categorize legislations into industries and link it to senators’ stock transactions. I find that their stock-picking ability is influenced by factors such as their proximity and involvement with congressional bills. I also find that senators with greater privileges tend to achieve more significant returns through transactions ahead of relevant industry bills, particularly in the later stages of bill development. My study lends support to the “senatorial privilege” hypothesis.

History

Table of Contents

1. Introduction -- 2. Data, Sample and Variables -- 3. Descriptive Results: Congressional Bill and Senator Financial Trading Statistics -- 4. Empirical Methods and Results -- 5. Conclusion and Future Work -- Reference -- Appendix

Awarding Institution

Macquarie University

Degree Type

Thesis MRes

Degree

Master of Research

Department, Centre or School

Department of Applied Finance

Year of Award

2024

Principal Supervisor

Vito Mollica

Additional Supervisor 1

Qing Zhou

Rights

Copyright: The Author Copyright disclaimer: https://www.mq.edu.au/copyright-disclaimer

Language

English

Jurisdiction

United States

Extent

79 pages

Former Identifiers

AMIS ID: 348827

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