This is
because they anticipate that new policies will benefit the companies in question. Thai
researchers have observed that, since 2001, there were many policies which benefited
listed companies linked to politicians in high government positions, especially at the
ministerial level. These policies include: discretionary tax breaks; reduction of
concession fee; restriction or discouragement of new entrants, as well as delaying of
policies which may affect the incumbent firms, such as the delay in operationalising
the anti-monopoly law, the delay to liberalize certain industries properly.
This phenomenon is not confined to Thailand, but cross-country studies have shown
that Thailand has one of the highest rates of political linkages among all the
stockmarkets of the world. I wonder if the Thai parliament is the only one in the
world that has invested in buying a real-time display of the stockmarket prices.
Although the methodology to establish the link between politics and the market
valuations of shares of firms belonging to the families of tycoons-turned-politicians is
still under scrutiny, we cannot deny the reality of the increased wealth of families of
tycoons-turned-politicians and the possibility of this wealth being used to maintain
their political and economic power further.