The European Commission and the revolving door

Decisions of the EU Commission have important consequences for the corporate sector. Thus, the fact that scores of ex-Commissioners go through the revolving door to work for companies raises concerns. Many suspect companies of profiting from privileged access to information and key decision-makers....

Full description

Saved in:
Bibliographic Details
Published inEuropean economic review Vol. 127; p. 103461
Main Authors Luechinger, Simon, Moser, Christoph
Format Journal Article
LanguageEnglish
Published Elsevier B.V 01.08.2020
Elsevier Science Publishers
Subjects
Conflicts of interest
D73
European Commission
European integration
Event study
F36
F53
G14
G30
Revolving door
Stock market
Stock markets
D73
F53
G30
European integration
Conflicts of interest
F36
Event study
G14
European Commission
Stock market
Revolving door
Online AccessGet full text

Cover

More Information
Summary:Decisions of the EU Commission have important consequences for the corporate sector. Thus, the fact that scores of ex-Commissioners go through the revolving door to work for companies raises concerns. Many suspect companies of profiting from privileged access to information and key decision-makers. We assess whether companies do indeed profit from hiring ex-Commissioners. Based on a unique dataset of all Commissioners who served in the Commissions of Jacques Delors I to José Manuel Barroso II spanning over 29 years, we look at stock market responses to announcements of such hirings. We find positive abnormal returns, which implies that investors anticipate benefits to companies. The reactions are larger for hirings in the first two years after a former Commissioner left office, when connections and insider knowledge are still fresh.
ISSN:0014-2921
1873-572X
DOI:10.1016/j.euroecorev.2020.103461