Wendy L. Hansen

Disaggregating and Explaining Corporate Political Activity: Domestic and Foreign Corporations in National Politics

Corporate political activity is usually operationalized and analyzed as financial contributions to candidates or political parties through political action committees (PACs). Very little attention has been paid to other dimensions, such as lobbying, in a systematic way. On a theoretical level we address the issue of how to conceive of PAC contributions, lobbying, and other corporate activities, such as charitable giving, in terms of the strategic behavior of corporations and the implications of “foreignness” for the different types of corporate political activity. On an empirical level we examine the political activities of Fortune 500 firms, along with an oversampling of U.S. affiliates of large foreign investors for the 1987–88 election cycle.

The Economics and Politics of Trade Policy: An Empirical Analysis of ITC Decision Making

We study the determinants of trade policy decisions focusing specifically on antidumping and countervailing duty statutes administered by the International Trade Commission (ITC). Using detailed industry, import, and political pressure data we model ITC decision making, weighing the relative impact of economic and political factors in predicting policy outcomes. We find the ITCs decision making is significantly influenced by both economic and political factors. However, because an industry has much greater ability to create political pressure than induce economic injury, our results highlight the strategic importance of oversight representation and PAC contributions in an industrys bid for protection.

The Determinants of Domestic and Foreign Corporate Political Activity

Corporate political action committees (PACs) are the focus of much research on corporate political activity Political scientists, economists, and sociologists have explored the determinants of PAC formation and PAC spending by advancing and to some extent testing hypotheses concerning the size of corporations, the regulation of industries, government procurement, social connections, and corporate cultures. Progress has been made in sorting through these hypotheses, although the amount of explained variance remains relatively modest. We define the dependent variable in three ways: the decision to form a PAC, the amount to be contributed, and the number of candidates to be supported. With data largely drawn from Fortune 500 companies for the 1987-1988 election cycle, improved firm-level measures of regulation, and the inclusion of political as well as economic factors influencing corporate decision-making, we develop and provide substantial support for a politically constrained, profit-maximizing model of corporate political activity.

Purchasing Protection? The Effect of Political Spending on U.S. Trade Policy

The issue of whether or not money influences policymaking has been widely debated in American politics. While a direct link between money and policy outcomes has proven difficult to make, bureaucratic decisions on trade protection provide an opportunity to link politically active firms and industries to policy outcomes. The U.S. International Trade Commission (ITC) and the U.S. Department of Commerce both play a major role in making trade policy by administering several important trade laws, including the U.S. antidumping law. Firms can petition the ITC and Commerce for protection from foreign firms that are alleged to engage in the unfair practice of dumping their goods on the U.S. market. Evidence suggests, however, that firms use this law as a means of seeking protection from foreign competition, even when that competition is fair. As the stakes are high for both domestic and foreign firms, there is the potential for political influence. Focusing on lobbying activities and campaign contributions, we analyze the influence of domestic and foreign monies on bureaucratic decisionmaking on trade policy.

Retaliation, Bargaining, and the Pursuit of “Free and Fair” Trade

That domestic political economic factors are important determinants of a nations trade barriers has been empirically well established. However, the question of how effective strategically retaliatory trade barriers are in deterring foreign protectionism has received far less systematic empirical attention. In this article we use bilateral nontariff barrier (NTB) data between the United States and five developed partner countries (Japan, France, Germany, Italy, and the United Kingdom) to systematically examine the effectiveness of strategic retaliation. We employ a simultaneous Tobit model where the home and foreign NTB levels are determined endogenously in a bilateral game. The model provides estimates of deterrence coefficients, that is, the reduction in foreign trade barriers as a result of U.S. retaliation, which we use to characterize the nature of bilateral NTB games. Our hope is that the empirical results presented here, which have realistic though controversial implications, will inform U.S. trade policy.

Globalization or National Capitalism: Large Firms, National Strategies, and Political Activities

Does the cross-border strategic behavior of large firms reflect national differences? There is uncertainty about the ways in which expanding markets will influence the activities of large firms and national governments. Some theorists expect market forces to produce increasing pressure for uniform patterns of behavior, while others have argued that the national political economy is more resilient, and that corporate strategies remain identifiably national. Thus far the question, theoretically and empirically, has been posed in terms of economic behavior and consequences. We analyze the persistence of national practices in the political activities of large corporations using data on the Fortune 1000 industrial and service companies for 1988. To increase the sample of affiliates of foreign firms, we include firms in the Forbes ranking of largest U.S. affiliates of foreign firms. This source includes financial and service corporations as well as those in manufacturing industries. Overall, the findings suggest that, contrary to the national capitalism argument, firms adapt to the host political economy.

Collective Action, Pluralism, and the Legitimacy Tariff: Corporate Activity or Inactivity in Politics

Despite the fact that domestic and foreign corporations, along with trade associations, are some of the most politically active groups in the United States, earlier research has identified a substantial number of firms that are politically inactive. Using fresh data collected from the 2000 election cycle for the Fortune 1000 and the Forbes top foreign investors, we examine business soft money, lobbying expenditures, as well as PAC contributions, in exploring economic, institutional, and political factors that might explain the choice of political activity or inactivity. This article goes beyond earlier research in several ways. Previous research has focused on PAC contributions rather than a fuller range of activities, and it has not included association political activity in the analysis of firm-level behavior. Also, the influence of other actors in the political system, notably environmental and citizen groups, has not been systematically examined. Theoretically, these data allow us to examine the countervailing power thesis, the institutionalists’ arguments about the nature of foreign business behavior, and the unexplored collective action questions that business associational activity poses—are firm and associational activities complements or substitutes?

The Effects of Citizens United on Corporate Spending in the 2012 Presidential Election

The 2012 presidential election saw a 594% increase in independent expenditures from the 2008 election (

The Demand for Reparations

144 million in 2008 to

Reparations and Reconciliation in the Aftermath of Civil War

1 billion in 2012), leaving little doubt that the Supreme Court’s landmark 2010 Citizens United decision opened the campaign spending floodgates. To what extent are corporations, the main subject of the ruling, the source of the increase? We argue that while Citizens alters the ability of corporations to spend on campaigns, it may not alter their substantial risk in doing so. Utilizing an original dataset of political activity and campaign contributions by Fortune 500 companies, we explore whether Citizens United affected corporations’ overall contribution strategies. We find that major corporations were not a source of the dramatic increase in independent spending in the 2012 election and that their spending behavior more generally did not change as a result of the Citizens United ruling.