Depositors Disciplining Banks: The Impact of Scandals

Can depositor activism make a real difference? New research set to be presented at the upcoming Stigler Center Political Economy of Finance conference examines the Dakota Access Pipeline controversy and similar events and suggests that banks see significant decreases in deposit growth after experiencing environmental, corruption, and tax evasion scandals.

 

 

Dakota Access Pipeline being built in central Iowa. Photo by Carl Wycoff from Nevada, USA [CC BY 2.0)], via Wikimedia Commons

In April 2016, the Dakota Access Pipeline (DAPL) protests began in reaction to an approved oil pipeline project in the northern United States. The pipeline sparked controversy among environmental activists as well as Native Americans, as it was intended to cross the Missouri and Mississippi rivers as well as ancient burial grounds. What was exceptional about this incident was

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