Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/296476.2 
Year of Publication: 
2025
Series/Report no.: 
IWH Discussion Papers No. 15/2024
Version Description: 
This version: 07.02.2025
Publisher: 
Halle Institute for Economic Research (IWH), Halle (Saale)
Abstract: 
We study how connections to German federal parliamentarians affect firm dynamics by constructing a novel dataset linking politicians and election candidates to the universe of firms. To identify the causal effect of access to political power, we exploit (i) new appointments to the company leadership team and (ii) discontinuities around the marginal seat of party election lists. Our results reveal that connections lead to reductions in firm exits, gradual increases in employment growth without improvements in productivity. Adding information on credit ratings, subsidies and procurement contracts allows us to distinguish between mechanisms driving the effects over the politician's career.
Subjects: 
firm performance
identification
political connections
politicians
JEL: 
D72
L25
O43
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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2 10419/296476.2 Revised Version: February 7, 2025
1 10419/296476 First Version: May 29, 2024

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