Detecting Illegal Arms Trade

• 成果类型: Article
• 署名作者: DellaVigna, Stefano; La Ferrara, Eliana
• 署名单位: University of California System; University of California Berkeley; National Bureau of Economic Research; Bocconi University
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.2.4.26
• 发表日期: 2010
• 页码: 26-57
• 关键词: tax evasion; CONFLICT; CORRUPTION; ECONOMY; MARKET

摘要

We propose a method to detect illegal arms trade based on investor knowledge. We focus on countries under arms embargo and identify events that suddenly increase or decrease conflict intensity If a weapon-making company is trading illegally, an event that increases the demand for arms may increase stock prices. We find positive event returns for companies headquartered in countries with high corruption and low transparency in arms trade. We also suggest a method to detect potential embargo violations based on chains of reactions by individual stocks. The presumed violations positively correlate with the number of UN investigations and Internet stories.