Is the revolving door a moderating force on politicians?

Board appointments represent highly lucrative career trajectories for former politicians. We investigate which types of legislators are more likely to gain board service. Leveraging comprehensive data on the board service of former Members of Congress, we show that ideological extremists are less likely to be appointed to a board after serving in Congress. Additionally, we use a difference-in-differences design to show that when the supply of legislators who are willing to take a directorship increases, firms become less likely to appoint extremist legislators to their board. The estimates are striking in magnitude, indicating a strong preference for appointing moderates to boards. Surprisingly, we find no evidence that a strong legislative record, service on powerful committees, or networks increase the probability of board service. The results show that extremist legislators are effectively shut out of one of the most lucrative post-elective career paths, placing a cost on radical behavior.

That is from a new paper by Benjamin C.K. Egerod and Hai Tran.

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