International relations and sovereign wealth funds' political value: evidence from a quasi-natural experiment

Gabriele Lattanzio, William L. Megginson

Research output: Contribution to journalArticleResearchpeer-review


This paper exploits the 2016 American presidential election as an exogenous shock to international political relations to study whether Sovereign Wealth Funds (SWFs) are investments vehicles used by foreign governments to influence the American political system. By combining an event study with cross-sectional analyses we identify weak support for international political relations being priced in the market through SWFs’ investments. These findings are consistent with and might explain the SWF discount identified in Bortolotti, Fotak and Megginson (2015). All in all, these results cast further doubts concerning SWFs’ absolute and unconditional political disinvolvment, calling for further research aimed to identify whether or not these funds pursue political goals.
Original languageEnglish
Pages (from-to)857-888
Number of pages32
JournalWake Forest Law Review
Issue number4
Publication statusPublished - 2017
Externally publishedYes

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