Despite politicians sometimes playing an active agentic role in firms’ resource dependency and in the outcomes of corporate political activity (CPA), there is limited research on the supply-side dynamics of political markets and the contingent role of normative institutions. This study aims to examine the relationship between managerial regulatory engagement (MRE) − a type of CPA − and access to bank finance, and how this relationship is moderated by country-level religiosity and religion policy regime.
Using data from over 37,000 firms in 43 sub-Saharan African countries and drawing on resource dependency and institutional theories, the authors deploy robust and sophisticated statistical analyses to test their hypotheses.
This study finds that MRE has a positive impact on access to bank finance. This effect is stronger in countries with more formal religion restriction where morality does not inhibit politicians’ discriminatory behaviour. However, this effect is weakened in countries where high levels of religiosity and more formal religion support curtail amoral rent provision.
These findings shed light on how firms’ use of CPA to manage resource dependency is affected by the influence of institutional religiosity on the agency of politicians. This study offers important theoretical contributions to the literature and generate useful implications for managers and policymakers.
