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Do businessmen make good governors?

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  • Neumeier, Florian

Abstract

This paper evaluates the economic performance of U.S. state governors with a business background (chief executive officer (CEO] governors). Applying a matching method, I find, first, that businesspeople tend to take office in times of economic and fiscal strain. Second, the tenures of CEO governors are associated with a 0.5 percentage points (pp.) higher annual income growth rate, a 0.4 pp. higher growth rate of the private capital stock, and a 0.6 pp. lower unemployment rate than are the tenures of non-CEO governors. State-level income inequality is not affected by CEO governors holding office, indicating that low-income households benefit from the economic upswing.

Suggested Citation

  • Neumeier, Florian, 2018. "Do businessmen make good governors?," Munich Reprints in Economics 62867, University of Munich, Department of Economics.
    • Handle: RePEc:lmu:muenar:62867
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    10. Abel FRANCOIS & Sophie PANEL & Laurent WEILL, 2018. "Are Some Dictators More Attractive to Foreign Investors?," Working Papers of LaRGE Research Center 2018-05, Laboratoire de Recherche en Gestion et Economie (LaRGE), Université de Strasbourg.
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    12. Niklas Potrafke, 2017. "Government Ideology and Economic Policy-Making in the United States," CESifo Working Paper Series 6444, CESifo.
    13. Cezara Vinturis, 2023. "How do fiscal rules shape governments' spending behavior?," Economic Inquiry, Western Economic Association International, vol. 61(2), pages 322-341, April.
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    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General

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