The Value of Political Capital: Dictatorship Collaborators as Business Elites

Felipe González and Mounu Prem

No 15980, Documentos de Trabajo from Universidad del Rosario

Abstract: What is the value of political capital for individuals? Towards the end of the Pinochet dictatorship in Chile, military and civilian collaborators entered the business elite, controlling the largest and most important firms in the country. Using a novel panel dataset of board members in these firms, we document a work premium for those who had previously collaborated with Pinochet. After democratization, however, collaborators were removed from boards and their compensation premium disappeared, suggesting that the value of their networks depreciated.To shed light on these findings, we study military personnel before, during, and after Pinochet and find evidence of a wage premium only during the dictatorship. We interpret these results as Pinochet favoring his collaborators while he was in power.

Pages: 39
Date: 2018-01-30
New Economics Papers: this item is included in nep-his, nep-pol and nep-soc
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Citations: View citations in EconPapers (16)

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Related works:
Journal Article: The value of political capital: Dictatorship collaborators as business elites (2018)
Working Paper: The Value of Political Capital: Dictatorship Collaborators as Business Elites (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:col:000092:015980

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