Business Elites, Political Connections, and Economic Entrenchment: Evidence from Belgium 1858-1909

44 Pages Posted: 7 Jan 2010

See all articles by Mihaela Livia Ghita

Mihaela Livia Ghita

University of Antwerp

Ludo Cuyvers

affiliation not provided to SSRN

Marc Deloof

University of Antwerp; University of Antwerp - Antwerp Management School

Date Written: December 22, 2009

Abstract

Pre-World War I Belgium was characterized by a strong concentration of power in the hands of a small elite with ties to business, banks, and politics. We find that political and upper class connections were widespread amongst listed firms, especially connections with the ruling political party. Connected firms had higher growth levels and a higher probability of survival. A shift in political power in 1870 significantly affected the value of connected firms. By 1905, it was bank-affiliated firms active in traditional industries, developed prior to 1870, that had more connections and accrued the largest benefits, which suggest economic entrenchment.

Keywords: business elites, political connections, nobility, economic entrenchment, resource dependency, first and second industrial revolution, pre-World War I Belgium

JEL Classification: G21, G28, G38, N23, N83, O16

Suggested Citation

Ghita, Mihaela Livia and Cuyvers, Ludo and Deloof, Marc, Business Elites, Political Connections, and Economic Entrenchment: Evidence from Belgium 1858-1909 (December 22, 2009). Available at SSRN: https://ssrn.com/abstract=1527108 or http://dx.doi.org/10.2139/ssrn.1527108

Mihaela Livia Ghita

University of Antwerp ( email )

Prinsstraat 13
BE-2000 Antwerp
Belgium

Ludo Cuyvers

affiliation not provided to SSRN

No Address Available

Marc Deloof (Contact Author)

University of Antwerp ( email )

Prinsstraat 13
Faculteit TEW
Antwerpen, 2000
Belgium
+32 3 265 41 69 (Phone)
+32 3 265 47 99 (Fax)

HOME PAGE: http://https://www.uantwerpen.be/en/staff/marc-deloof/

University of Antwerp - Antwerp Management School ( email )

Boogkeers 5
Antwerp, 2000
Belgium

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