Working Paper: NBER ID: w30182
Authors: Emanuele Colonnelli; Valdemar Pinho Neto; Edoardo Teso
Abstract: We study how individual political views shape firm behavior and labor market outcomes using new micro-data from Brazil. We first show that business owners are considerably more likely to employ copartisan workers. This phenomenon is in part driven by the overlapping of political and social networks. Multiple tests—a survey, an event study, analyses of wage premia and promotions within the firm, and a field experiment—further highlight how business owners’ political preferences directly influence firms’ employment decisions. A channel of political discrimination appears more relevant than one of political quid-pro-quo between firms and politicians.
Keywords: No keywords provided
JEL Codes: D22; D72; D73; G0; G3; G4; J0; J15; J2; J3; J7; O0; O1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Political views (D72) | Hiring decisions (M51) |
| Political discrimination (J71) | Workplace outcomes (J29) |
| Political affiliation (D72) | Economic advantages within firms (D22) |
| Stronger political assortative matching (D79) | Slower firm growth (D25) |