Measuring the Effects of Post-Government-Employment Restrictions

Abstract

The revolving door problem linking private interests and government decision makers has become an important mechanism in the implementation of influence peddling. The revolving door problem is premised on the assumption that a market exists for the services of former government employees. However, no attempt has been made to provide a measure of the value of these services, nor to evaluate the effect of regulations intended to curb the problem. This article attempts to fill this gap by utilizing an event-study methodology to measure the effect of gaining access to government under alternative regulations.