Subscribe: Journal of Law, Economics, and Organization - Advance Access
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The Journal of Law, Economics, and Organization Advance Access

Published: Mon, 14 Aug 2017 00:00:00 GMT

Last Build Date: Wed, 16 Aug 2017 01:52:46 GMT


Campaign Contributions from Corporate Executives in Lieu of Political Action Committees


Limiting corporate participation in electoral politics is a central focus of campaign finance reform. In this spirit, individual candidates for office have prohibited corporate-linked political action committees (PACs) from contributing to their campaigns. On the surface, such no-PAC policies might seem like an effective way to keep corporate-linked monies out of electoral politics; however, they ignore the reality that corporate monies have a variety of ways to find their way into candidates’ campaign accounts. We leverage these candidate-specific refusals to accept PAC monies to uncover concomitant spikes in the pattern of corporate executives’ personal campaign contributions that are most pronounced for executives at firms with active PACs which contributed to the candidates in question. These results come from a newly constructed dataset that includes all CEO–firm–candidate contribution pairs for active S&P500 firms over an 18-year period and suggests that CEOs strategically act in lieu of their firms’ linked PACs. (JEL D72, L51)

Returns to Office in National and Local Politics: A Bootstrap Method and Evidence from Finland


We estimate the private returns to being elected to parliament or to a municipal council using a regression discontinuity (RD) design. We first present a bootstrap method for measuring the closeness of elections, which can be applied to any electoral system. We then apply the method to perform a RD estimation in Finland, where seats are assigned according to a proportional open-list system. Becoming a member of parliament increases annual earnings initially by about €20,000, and getting elected to a municipal council by about €1000. Subsequent earnings dynamics reveal that the returns to parliamentarians accrue mainly during the time in office, while the effect on later earnings is small. We also find a relatively weak individual incumbency advantage of 18 percentage points in parliamentary elections; the incumbency effect in municipal elections is negligible. (JEL D72, J45)