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On the returns to holding political office (Is it worth it?)

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  • Berg, Heléne

Abstract

The paper estimates causal effects of being elected in a local election on monetary returns. The claim for causality is made in a research design where the income of some candidate who just barely won a seat is compared to that of some other candidate who was close to winning a seat for the same party, but ultimately did not. This research design is made possible thanks to a comprehensive, detailed data set covering all Swedish politicians who have run for office in the period 1991–2006. The analysis establishes that monetary returns from local politics are absent both in the short and long run. By relating this null result to effects on the future political career, the paper provides suggestive evidence that local politicians are not primarily motivated by money.

Suggested Citation

  • Berg, Heléne, 2020. "On the returns to holding political office (Is it worth it?)," Journal of Economic Behavior & Organization, Elsevier, vol. 178(C), pages 840-865.
    • Handle: RePEc:eee:jeborg:v:178:y:2020:i:c:p:840-865
    DOI: 10.1016/j.jebo.2020.08.004
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    References listed on IDEAS

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    Cited by:

    1. Palguta, Ján & Pertold, Filip, 2021. "Political salaries, electoral selection and the incumbency advantage: Evidence from a wage reform," Journal of Comparative Economics, Elsevier, vol. 49(4), pages 1020-1047.
    2. Berg, Heléne, 2020. "Politicians’ payments in a proportional party system," European Economic Review, Elsevier, vol. 128(C).
    3. Olle Folke & Linna Martin & Johanna Rickne & Matz Dahlberg, 2021. "Politicians' neighbourhoods: Where do they live and does it matter?," Discussion Papers 2021-03, Nottingham Interdisciplinary Centre for Economic and Political Research (NICEP).
    4. Marco Bertoni & Giorgio Brunello & Lorenzo Cappellari & Maria De Paola, 2023. "The long-run earnings effects of winning a mayoral election," LISER Working Paper Series 2023-02, Luxembourg Institute of Socio-Economic Research (LISER).
    5. Jon H. Fiva & Max-Emil M. King, 2022. "Child Penalties in Politics," CESifo Working Paper Series 9611, CESifo.

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    More about this item

    Keywords

    Returns to politics; Incumbency effects; Regression discontinuity design;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations

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