Social Proximity, Revolving Doors, and Private Sector Lobbying of the US Securities and Exchange Commission 1996-2013

Sunday, June 26, 2016: 9:00 AM-10:30 AM
228 Dwinelle (Dwinelle Hall)
Kevin Young, University of Massachusetts Amherst, Amherst, MA
How extensive is the ‘revolving door’ between regulators and firms in the financial sector?
What are its consequences on how policy is actually made? While the metaphor of the
revolving door is frequently deployed in policy debates regarding capture, inequality and
unequal access, empirical measurements of it have been highly elusive. This paper measures
the extent of the revolving door in operation, and its consequences, through social network
analysis. By modelling the complex series of personnel ties among senior regulatory officials
and personnel at financial industry firms as a complex social network, we generate a
distribution of social proximity between these firms and their regulators. Some organizations
are closer to their regulators than others, because of differences in the intensity of personnel
flows and n-degree connections between organizations. Such a measure of social proximity
can then be used to predict degrees of preference attainment among across a range of different
policy issues, both before and after the recent financial crisis. Our data examines
approximately 4000 lobbying attempts by private sector groups trying to shape the policies of
the US Securities and Exchange Commission (SEC) between 1996-2013.