Revolvers in the corporate elite

How do firms employ political connections to deal with their non-market environment? To answer this question, we provide the most comprehensive empirical examination of firms' employment of former public officials -revolvers- to date. Building on a rich literature in management and political science, we argue that political skills and connections of revolvers are multidimensional, non-substitutable, and complementary. We investigate the role of revolvers using comprehensive data on the universe of revolvers on boards and in senior management of U.S. publicly traded firms. First, we show that 56% of publicly traded firms employ revolvers and that companies frequently employ multiple revolvers. Second, revolver hiring and roles in firms crucially depend on the revolver's background. Firms hire different types of revolvers in response to different shocks to their non-market environment, and the arrival of a revolver increases the firm's propensity to lobby. Finally, we find that revolver arrivals increase firm financial performance, which is partly driven by federal contracts, and that multiple different types yield higher returns. Our results have implications for the strategic linkages between corporate non-market strategies, the returns to political connections, and effective hiring in top-level companies.