MPs for Sale? Returns to Office in Postwar British Politics

American Political Science Review, Vol. 103, No. 4, November 2009

Posted: 22 Mar 2011

See all articles by Andrew C. Eggers

Andrew C. Eggers

University of Oxford

Jens Hainmueller

Stanford University - Department of Political Science; Stanford Graduate School of Business; Stanford Immigration Policy Lab

Date Written: March 16, 2011

Abstract

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 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.

Keywords: legislatures, political connections, corruption

JEL Classification: P16

Suggested Citation

Eggers, Andrew C. and Hainmueller, Jens, MPs for Sale? Returns to Office in Postwar British Politics (March 16, 2011). American Political Science Review, Vol. 103, No. 4, November 2009. Available at SSRN: https://ssrn.com/abstract=1788412

Andrew C. Eggers

University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

Jens Hainmueller (Contact Author)

Stanford University - Department of Political Science ( email )

Stanford, CA 94305
United States

HOME PAGE: http://www.stanford.edu/~jhain/

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

Stanford Immigration Policy Lab

30 Alta Road
Stanford, CA 94305
United States

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