MPs for Sale? Returns to Office in Postwar British Politics

Bibliographic Data

ID3765261
AuthorsAndrew C Eggers (0000-0002-2362-0654, Harvard University Press), Jens Hainmueller (0000-0001-8214-9041, Massachusetts Institute of Technology)
Year2009
Volume103
Issue4
Pages513-533
Publication date2009-11-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueAmerican Political Science Review (JOURNAL)
Journal identifiersISSN: 0003-0554 • E-ISSN: 1537-5943
PublisherCambridge University Press (CUP) (PUBLISHER)
DOI10.1017/s0003055409990190
OpenAlexW2113982033
LanguageEN
Citations received143
References cited57

Many recent studies show that firms profit from connections to influential politicians, but less is known about how much politicians financially benefit from wielding political influence. We estimate the returns to serving in Parliament, using original data on the estates of recently deceased British politicians. Applying both matching and a regression discontinuity design to compare Members of Parliament (MPs) with parliamentary candidates who narrowly lost, we find that serving in office almost doubled the wealth of Conservative MPs, but had no discernible financial benefits for Labour MPs. Conservative MPs profited from office largely through lucrative outside employment they acquired as a result of their political positions; we show that gaining a seat in Parliament more than tripled the probability that a Conservative politician would later serve as a director of a publicly traded firm-enough to account for a sizable portion of the wealth differential. We suggest that Labour MPs did not profit from office largely because trade unions collectively exerted sufficient control over the party and its MPs to prevent members from selling their services to other clients

Public office · Regression discontinuity design · Corporate Finance and Governance · Fiscal Policies and Political Economy · Political Influence and Corporate Strategies

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