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Do businessmen make good governors?

Author

Listed:
  • Neumeier, Florian

Abstract

This paper evaluates the economic performance of U.S. state governors with a business background (chief executive officer (CEO] governors). Applying a matching method, I find, first, that businesspeople tend to take office in times of economic and fiscal strain. Second, the tenures of CEO governors are associated with a 0.5 percentage points (pp.) higher annual income growth rate, a 0.4 pp. higher growth rate of the private capital stock, and a 0.6 pp. lower unemployment rate than are the tenures of non-CEO governors. State-level income inequality is not affected by CEO governors holding office, indicating that low-income households benefit from the economic upswing.

Suggested Citation

  • Neumeier, Florian, 2018. "Do businessmen make good governors?," Munich Reprints in Economics 62867, University of Munich, Department of Economics.
    • Handle: RePEc:lmu:muenar:62867
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    Cited by:

    1. Luis Diaz-Serrano & Giorgos Kallis, 2022. "Political leaders with professional background in business and climate outcomes," Climatic Change, Springer, vol. 172(1), pages 1-20, May.
    2. François, Abel & Panel, Sophie & Weill, Laurent, 2020. "Educated dictators attract more foreign direct investment," Journal of Comparative Economics, Elsevier, vol. 48(1), pages 37-55.
    3. Niklas Potrafke, 2018. "Government ideology and economic policy-making in the United States—a survey," Public Choice, Springer, vol. 174(1), pages 145-207, January.
    4. Gutmann, Jerg & Metelska-Szaniawska, Katarzyna & Voigt, Stefan, 2024. "Leader characteristics and constitutional compliance," European Journal of Political Economy, Elsevier, vol. 84(C).
    5. Gjerde, Kathy Paulson & Prescott, Peter & Rice, Jennifer, 2019. "The Impact of State Fiscal Policy on States' Resilience Entering the Great Recession," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 49(01), January.
    6. Cerciello, Massimiliano & Agovino, Massimiliano & Garofalo, Antonio, 2019. "The caring hand that cripples? The effects of the European regional policy on local labour market participation in Southern Italy," Socio-Economic Planning Sciences, Elsevier, vol. 68(C).
    7. Paul Pelzl & Steven Poelhekke, 2023. "Democratization, leader education and growth: firm-level evidence from Indonesia," Journal of Economic Growth, Springer, vol. 28(4), pages 571-600, December.
    8. Abel FRANCOIS & Sophie PANEL & Laurent WEILL, 2018. "Are Some Dictators More Attractive to Foreign Investors?," Working Papers of LaRGE Research Center 2018-05, Laboratoire de Recherche en Gestion et Economie (LaRGE), Université de Strasbourg.
    9. Borgschulte, Mark & Vogler, Jacob, 2019. "Run for your life? The effect of close elections on the life expectancy of politicians," Journal of Economic Behavior & Organization, Elsevier, vol. 167(C), pages 18-32.
    10. Potrafke, Niklas, 2025. "The economic consequences of businesspeople in politics: A survey," European Journal of Political Economy, Elsevier, vol. 86(C).
    11. Abel FRANCOIS & Sophie PANEL & Laurent WEILL, 2018. "Are Some Dictators More Attractive to Foreign Investors?," Working Papers of LaRGE Research Center 2018-05, Laboratoire de Recherche en Gestion et Economie (LaRGE), Université de Strasbourg.
    12. Li, Jingheng & Xi, Tianyang & Yao, Yang, 2020. "Empowering knowledge: Political leaders, education, and economic liberalization," European Journal of Political Economy, Elsevier, vol. 61(C).
    13. David Szakonyi, 2018. "Private Sector Policymaking," Working Papers 2018-8, The George Washington University, Institute for International Economic Policy.
    14. Niklas Potrafke, 2025. "Sind Unternehmer erfolgreiche Politiker? Eine Evaluierung der Forschungsergebnisse," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 78(03), pages 36-39, March.
    15. Niklas Potrafke, 2017. "Government Ideology and Economic Policy-Making in the United States," CESifo Working Paper Series 6444, CESifo.
    16. Cezara Vinturis, 2023. "How do fiscal rules shape governments' spending behavior?," Economic Inquiry, Western Economic Association International, vol. 61(2), pages 322-341, April.
    17. Adam Pilny & Felix Roesel, 2020. "Are Doctors Better Health Ministers?," American Journal of Health Economics, University of Chicago Press, vol. 6(4), pages 498-532.
    18. Anna Abalkina & Alexander Libman, 2020. "The real costs of plagiarism: Russian governors, plagiarized PhD theses, and infrastructure in Russian regions," Scientometrics, Springer;Akadémiai Kiadó, vol. 125(3), pages 2793-2820, December.

    More about this item

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General

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