The Partisanship of Financial Regulators

Engelberg, Joseph; Henriksson, Matthew; Manela, Asaf; Williams, Jared

doi:10.2139/ssrn.3481564

The Partisanship of Financial Regulators

33 Pages Posted: 14 Nov 2019

See all articles by Joseph Engelberg

Joseph Engelberg

University of California, San Diego (UCSD) - Rady School of Management

Matthew Henriksson

University of South Florida Muma College of Business

Asaf Manela

Washington University in St. Louis - John M. Olin Business School

Jared Williams

University of South Florida

Date Written: October 29, 2019

Abstract

We analyze the partisanship of Securities and Exchange Commissioners (SEC) and members of the Federal Reserve Board of Governors (Fed) using the language-based approach of Gentzkow, Shapiro, and Taddy (Econometrica, 2019). The level of partisanship among these regulators is greater than that of Congress, but this is driven by a handful of speakers who repeat polarizing phrases across several speeches. When we quantify how much Republican (Democrat) regulators sound like Republicans (Democrats) in Congress we find no discernible pattern among Fed governors but a recent spike among SEC commissioners.

Keywords: Partisanship, Federal Reserve, Security and Exchange Commission, Textual Analysis

JEL Classification: G18, G28, G38

Suggested Citation: Suggested Citation

Engelberg, Joseph and Henriksson, Matthew and Manela, Asaf and Williams, Jared, The Partisanship of Financial Regulators (October 29, 2019). Available at SSRN: https://ssrn.com/abstract=3481564 or http://dx.doi.org/10.2139/ssrn.3481564