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Title: When politicians collude with firms : the impact of elite networks on inequality
Author: Vukovic, Vuk
ISNI:       0000 0004 8502 9178
Awarding Body: University of Oxford
Current Institution: University of Oxford
Date of Award: 2019
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This thesis examines the effect of elite networks on inequality. Elite networks are informal social networks between politicians in power and top executives of politically connected firms where personal ties and long-term interactions build trust and loyalty between involved actors. Both groups draw benefits from these interactions. Politicians stay in power and may extract bribes and other favours, while firms are rewarded with exclusive government contracts, favourable regulation, and direct subsidies. Top corporate executives that are successful in acquiring these rents, as a consequence of their elite network interactions, are rewarded by their firms with higher salaries. This consequentially widens the dispersion of earnings between the top 1% of income earners (most of which are corporate executives) and everyone else. The contribution of this thesis to the political economy literature is twofold: (1) it examines, on an individual level, the consequences elite network interactions have on its members; increasing re-election chances for politicians and securing rents for firms, and (2) it examines the consequences elite networks impose on society, notably on increasing income inequality. It presents a thus far unrecognized factor that may help explain the rise of income inequality in the US and the UK. The thesis is organized into three stand-alone papers. The first two papers show the benefits of collusion for politicians and firms, while the third one links the impact of elite networks on inequality. The first paper shows that politicians which distribute fraudulent procurement contracts increase their chances of re-election. The second paper shows that politically connected financial firms were favoured in the TARP allocation process during the US financial crisis. The third paper shows that politically connected senior executives have significantly higher earnings than non-connected ones.
Supervisor: Ansell, Ben Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available