What's the value of a lobbyist?:
Economists calculate true value of 'who' you know, rather than 'what' in US politics, EurekAlert: Economists at the University of Warwick have calculated the true value of US political lobbyists, proving the old adage 'it is not what you know, but who you know'.
In a paper published this month in the American Economic Review Mirko Draca, from the University of Warwick's Department of Economics, looked at the role of lobbyists in the US. He found their revenue falls by 24% when their former employer leaves government office.
The study examined the so-called 'revolving door' of politics, which refers to the movement of people from government service into lobbying positions.
Mr Draca said: "We investigated how the revenues of lobbyists who had previously worked in the offices of a member of US Congress were affected when their former employers left office. This allowed us to look at the value of 'what' and 'who' because we evaluated situations in which knowledge did not change, but connections did."
The paper, co-authored by Jordi Blanes i Vidal, London School of Economics, and Christian Fons-Rosen from Universitat Pompeu Fabra, found the24% fall in revenue was immediate and long-lasting. The relative pay of lobbyists depends on the seniority and committee assignments of the congressional politicians they have worked for in the past.
Mr Draca said: "Our work quantifies, I believe for the first time, the value of personal connections to elected officials for lobbyists in Washington, rather than relying on anecdotal evidence." ...