relatively discretionary way.<sup>14</sup> Therefore, as chairmen of important committees, senators gain greater media and political exposure and as a result, are better able to support firms from their state.<sup>15</sup> Moreover, being chair of a relevant committee signals substantial political influence.

Presiding a committee gives political power not only to the chairman but also to his party. Therefore, several weeks of intense negotiations in the senate take place behind doors to select the chairmen of the relevant committees. This process can be summarized in two stages: First, each party postulates senators to chair the committees that best match their expertise and interest. In the second stage, the political groups in the senate negotiate the committee chairs, guaranteeing that its distribution is proportional to the seats that each party holds in the senate.<sup>16</sup> The relative importance of the committees varies substantially depending on the topics they legislate, the operating funds they receive, and more importantly, the number and influence of bills in their purview (Langston and Aparicio, 2009). The most important and contested committees are those that deal with economic, fiscal and budgetary topics (Garcia and Sanchez, 2002). While there is no unique ranking of the more influential committees, Ballinas and Becerril (2012) identify the following committees as the most influential: Administration, Agriculture, Commerce, Constitution, Energy, Governance, Legislation, Legislation I, Legislation II, Justice, Telecommunications, Transport and Treasury.<sup>17, 18</sup> In terms of legislative work, these committees concentrate around 78 percent of all bills received in the Senate in the period we examine.<sup>19</sup> According to this definition, and after hand collecting information on all 256 senators elected in 2000 and 2006, we divide senators into three types, increasing in political importance. The type I includes all senators that did not chair any commission; the second type includes all senators who have only chaired non-influential commissions; while the third type includes all the remaining senators that have presided an influential committee. As shown in Table A3, 44 percent of senators are type I, 42 percent of senators are type II, and the remaining 14 percent are type III. In this

> 14 Recent studies show evidence that leakage of important macro-news and policies affects the distribution of private information in the financial market. (e.g. Bernile, Hu and Tang, 2015; Agarwal, et al.,2015b). 15 Senators can only preside one commission per legislature.

> 16 This negotiation takes place through the _Junta de Coordinacion Politica_ , a group within the Senate formed by the senators leading each parliamentary group, as well as three additional senators: two from the largest parliamentary group and one from the smallest one. By law, the votes of the members of the _Junta_ are weighted by the number of senators that each parliamentary group has (Articulo 81, Ley Organica del Congreso General De los Estados Unidos Mexicanos).

17 With 60 permanent committees, the Mexican senate is the upper chamber with more committees worldwide (Power, 2012; Morales, 2015).

18 For each committee, Table A1 displays a brief description of its main areas of work as well as the state of its chairman per legislature. These committees can be further divided into ones that are related to specific economic sectors (e.g. Energy) and those that purview a more global agenda (e.g. Treasury). In the last column of Table A1 we display the economic sectors that are directly related with the purview of a committee using the NAICS 2007 classification.

> 19 Detailed data on all the bills received in the Senate for the years of our study was downloaded from the website of the Legislative Information System of the Mexican Ministry of Governance. The information for each bill includes its date, type of bill, topic, person/institution/political party that presented it, and the committee the bill was channeled to.

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