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Trevor Incerti (Yale) & Hikaru Yamagishi (Yale), “Do Firms Benefit from the Revolving Door? Evidence from Japan”
August 13 @ 8:00 pm - 9:00 pm EDT
U.S. EDT: 8 – 9 pm, August 13 (Thursday)
JST: 9 – 10 am, August 14 (Friday)
NOTE: Registration required! LINK
Abstract: A growing literature finds high returns to firms connected to legislative office. Less attention has been paid to benefits from bureaucratic connections. Yet recent evidence shows that the groups actively contacting the legislature extensively contact bureaucrats as well. Private sector hiring of former civil servants—a process known as the revolving door—facilitates this practice. Leveraging a 2009 law requiring Japanese bureaucratic agencies to report all private sector hires of former civil servants, we construct the first comprehensive dataset of revolving door hires. Using this dataset, as well as data on Japanese government contracts, we test for systematic benefits that accrue to firms who hire former bureaucrats. Specifically, we hypothesize that bureaucratic rehiring will be associated with an increased likelihood of receipt of government contracts and investment. Finally, we test for stock market boosts from hiring of high-ranking former officials using an event study approach.
Chair: Daniel Smith (Harvard).