Working Paper: NBER ID: w12921
Authors: Andrea Mattozzi; Antonio Merlo
Abstract: Two main career paths are prevalent among politicians in modern democracies: there are career politicians (i.e., politicians who work in the political sector until retirement), and political careers (i.e., there are politicians who leave politics before retirement and work in the private sector). In this paper, we propose a dynamic equilibrium model of the careers of politicians in an environment with a private sector and a political sector, where individuals are heterogeneous with respect to their market ability and political skills. Our analysis provides an explanation for the existence of career politicians and individuals with political careers, and their motivations. We also investigate the effects of monetary incentives and other features of the political-economic environment on the quality of politicians and their careers. We show that an increase in the salary a politician receives while in office decreases the average quality of individuals who become politicians, decreases turnover in office, and may either decrease or increase the average quality of career politicians.
Keywords: No keywords provided
JEL Codes: D72; J44; J45
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| increase in political salary (D72) | decrease in average quality of politicians (D72) |
| increase in political salary (D72) | decrease in turnover in office (J63) |
| increase in market wage rate (J31) | increase in average quality of politicians (D72) |
| increase in market wage rate (J31) | increase in turnover in office (M51) |
| increase in market wage rate (J31) | effect on average quality of career politicians (D72) |