Difference-in-Differences with Staggered Treatments: An Application with Firms and Revolving Door Lobbying

Abstract

“Revolving door” lobbying describes the back-and-forth transition of individuals between public service and employment in lobbying, raising normative concerns around the role of special interests in public policy. Little, however, is known about individuals who make the transition from lobbying into government. Using unique panel data from 2001-2020 of U.S. federal bureaucrats and congressional staff matched to lobbying records, we 1) provide important stylized facts on this phenomenon and 2) quantify the value to lobbying firms when their employees enter government service. Employing a matched difference-in-differences design appropriate for staggered treatment timing, we find lobbying firms that gain government connections through departure of one of their lobbyists experience a 36% revenue increase, or roughly $320,000 per year. These results shed light onto the political economy of the lobbying industry and the value of access in lobbying, and provide needed context surrounding ongoing policy debates on revolving door regulation.