This paper investigates a little studied but common mechanism that …rms use to obtain state favors: business owners themselves seeking election to top o¢ ce. Using Thailand as a research setting, we …nd that the more business owners rely on government concessions or the wealthier they are, the more likely they are to run for top o¢ ce. Once in power, the market valuation of their …rms increases dramatically. Surprisingly, the political power does not in ‡uence the …nancing strategies of their …rms. Instead, business owners in top o¢ ce use their policy-decision powers to implement regulations and public policies favorable to their …rms. Such policies hinder not only domestic competitors but also foreign investors. As a result, these politically connected …rms are able to capture more market share.

This paper presents the first empirical evidence showing that the marriage of a member of the controlling family adds value to public corporations. The results, based on a uniquely comprehensive data set from Thailand, show that the family firm’s stock price increases when the partner is from either a prominent business or a political family. Abnormal returns tend to be higher for firms whose operation depends on extensive networks. In contrast, marriages to ordinary citizens are not associated with any abnormal returns. These findings are generally supportive of the value of networks in general and marriage in particular.

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