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Backscratching in banks: political cycles in bank manager appointments

Published online by Cambridge University Press:  28 December 2020

Jonas Markgraf*
Affiliation:
Department of Politics and International Relations, University of Oxford, Oxford, UK
*
Corresponding author. Email: jonas.markgraf@politics.ox.ac.uk

Abstract

Close ties between politicians and businesses affect firms’ performance and political outcomes, and while direct political control over firms has been curtailed by tightened regulation, political connections remain ubiquitous in many countries. Yet, it is unclear through which channels these linkages are maintained in strictly regulated environments. I speculate that one such channel of political control over firms is politicians’ ability to influence corporate appointment decisions. To test the claim, I employ survival models that analyze chairpersons’ turnovers in 90 Spanish savings banks between 1985 and 2010 and find strong evidence for electoral appointment cycles: bank chairpersons are more likely to lose office shortly after regional elections and when new governments enter office.

Type
Research Note
Copyright
Copyright © The Author(s), 2020. Published by Cambridge University Press on behalf of the European Political Science Association

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