In this paper, we discuss whether and how bank lobbying can lead to regulatory capture and have real consequences … through an overview of the motivations behind bank lobbying and of recent empirical evidence on the subject. Overall, the … interpreted as a call for an outright ban of lobbying, they point in the direction of a need for rethinking the framework …

Using detailed information on lobbying and mortgage lending activities, we find that lenders lobbying more on issues … negative abnormal stock returns during key crisis events. The findings are robust to (i) falsification tests using lobbying on …) instrumental variables strategies. These results show that lobbying lenders engage in riskier lending …