Empirical analysis reveals that capital and R&D intensity drive political strategy in corporate spin-offs, highlighting how newly independent firms manage external resource dependencies.
Key Points
To examine how and when corporate spin-offs employ corporate political strategies to manage external dependencies and navigate their political environment after separation.
Analyzed a sample of 205 corporate spin-offs from 2012 to 2022.
Tracked firm political activity using lobbying expenditures and campaign contributions alongside financial metrics from COMPUSTAT.
Estimated relationships between resource intensities, organizational slack, and political strategy using generalized least squares regression models.
Capital intensity and research and development (R&D) intensity are positively and significantly associated with spin-off firms' engagement in corporate political strategy.
Organizational slack significantly strengthens the positive relationship between R&D intensity and corporate political strategy engagement.