Working Paper: NBER ID: w22756
Authors: Nathan Canen; Francesco Trebbi
Abstract: This paper presents and structurally estimates a model of endogenous network formation and legislative activity of career-motivated politicians. Employing data on socialization and legislative effort of members of the 105th-110th U.S. Congresses, our model reconciles a set of empirical regularities, including: recent trends in Congressional productivity; the complementarity of socialization processes and legislative activities in the House of Representatives; substantial heterogeneity across legislators in terms of effort and success rate in passing specific legislation. We avoid taking the social structure of Congress as exogenously given and instead embed it in a model of endogenous network formation useful for developing relevant counterfactuals, including some pertinent to the congressional emergency response to the 2008-09 financial crisis. Our counterfactual analysis further demonstrates how to empirically identify the specific equilibrium at play within each Congress among the multiple equilibria typically present in this class of games.
Keywords: endogenous networks; legislative productivity; socialization; congress
JEL Codes: P16; P48
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| socialization efforts (si) (O35) | legislative success (yi) (D72) |
| legislative efforts (xi) (K16) | legislative success (yi) (D72) |
| socialization efforts (si) + legislative efforts (xi) (P37) | legislative success (yi) (D72) |
| socialization efforts (si) (O35) | probability of reelection (p(re_elected)) (D79) |
| legislative efforts (xi) (K16) | probability of reelection (p(re_elected)) (D79) |
| socialization efforts (si) and legislative efforts (xi) (P37) | outcomes of connections through reciprocity mechanisms (L14) |
| equilibrium strategies of all politicians (D72) | individual choices regarding effort levels (J22) |