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2 Account. Econ. Law [xxiii] (2012)
Stock Ownership, Political Beliefs, and Party Identification from the 'Ownership Society' to the Financial Meltdown

handle is hein.journals/acteol2 and id is 305 raw text is: 











  Stock Ownership, Political Beliefs, and Party

Identification from the Ownership Society to

                     the Financial Meltdown


                   Natalie C. Cotton  Nessler and  Gerald F. Davis




                                        Abstract
    In this paper we investigate the link between stock ownership, political beliefs, and party
identification. Stock ownership significantly increased the likelihood of voters identifying with
the Republican Party between 2000 and 2004 - a period when that party offered tax cuts and
proposed an overhaul of Social Security which directly appealed to shareholders. Yet in the period
leading up to the 2008 election, the financial crisis cast doubt on the idea that a Republican
administration would best represent stockholder interests. We find that while there was a small
backlash, stockholders largely remained committed to the party in high numbers. But these effects
vary depending on the ideological orientation of stockholders: In 2004, those stockowners with the
most ideologically conflicted views were most receptive to recruitment by the Republican Party,
and stock ownership continued to increase Republicanism among those in 2008 who were more
ideologically liberal on economic issues. These results suggest that party identification may be less
about pure economic interests than about identity, especially for those whose ideological beliefs do
not map cleanly onto the liberal/conservative continuum, and that psychological mechanisms such
as cognitive dissonance and identity conflict are important drivers of political behavior.


KEYWORDS: stock ownership,   political identification, cognitive dissonance, identity conflict


JEL  Classification Codes: D72, Z13, P16

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