Executives in Politics

We document that the share of corporate executives in federal elected office increased from 13.3% in 1980 to 22.6% in 2018 and find evidence consistent with executives entering politics to advance their firms' interests. First, firms make substantial political contributions to their former executives. Second, executives' electoral wins and legislation passage are associated with positive stock returns for their firms. Third, executives are more likely to join congressional committees overseeing their firms' industries. Fourth, executives accumulate a pro-business voting record. Finally, executives are more likely to seek political office when their industries are hit by competitive shocks. Overall, our results indicate that corporate executives have increased their direct involvement in the legislative process in the United States and that this involvement may have generated substantial benefits for their firms