Cambridge University Press

Cambridge University Press

December 11, 2009 06:00 ET

'MPs For Sale?' Tories Profit From Parliament, Study Shows

Political scientists reveal financial benefits to MPs unequal based on party affiliation.

CAMBRIDGE, UNITED KINGDOM--(Marketwire - Dec. 11, 2009) - Serving in Parliament almost doubles the wealth of Conservative MPs, new research based on historical data from Harvard and MIT, published by the American Political Science Review, aims to show.

In a ground-breaking study that analysed the estates of British politicians who have recently died, researchers Andy Eggers and Jens Hainmueller from Harvard University say they have been able to place a financial value on political power in post-war British politics.

Using data about the estates of politicians who entered the House of Commons between 1950 and 1970 and often served well into the 1990s, Eggers and Hainmueller compared their wealth (at death) with that of politicians who narrowly missed election to Parliament.

Conservative MPs in this category died almost twice as wealthy as similar Conservatives who unsuccessfully ran for Parliament; no such difference is evident among Labour politicians.

In 'MPs For Sale?' Returns to Office in Postwar British politics' published in the journal American Political Science Review, Eggers and Hainmueller - from Harvard University and the Massachusetts Institute of Technology respectively - show that Conservative MPs appear to have profited from office largely through lucrative outside employment gained through their political positions.

Gaining a seat in Parliament more than tripled the probability that a Conservative politician would later serve as a director of a publicly-traded firm - enough to account for a sizable portion of the wealth differential.

Labour MPs did not profit from office largely because trade unions effectively monopolized the market for political services by controlling the party and its politicians and securing their services mainly free of charge.

The paper provides the first estimates of the total financial rewards of attaining legislative office. The financial benefits of office are likely to be attributable to payments from private firms to serving MPs and lucrative employment opportunities provided to politicians after retirement. Conservative MPs financially benefited from directorships and consulting work that came their way as a result of serving in political office. Labour politicians relationships with unions were far less lucrative because the trade unions secured their services largely through non-monetary means.

Jens Hainmueller said: "The data makes us quite confident that the difference in wealth we observe between winning and losing candidates is due to serving in Parliament itself (as opposed to background differences such as schooling, family circumstances etc). Being in office was lucrative for Conservative politicians because it endowed them with political connections and knowledge that they could put to personal financial advantage."

The researchers' calculations suggest that this difference in the number of directorships alone can account for a sizable portion of the wealth differential between MPs and unsuccessful candidates from the Conservative Party.

Andrew Eggers commented: "One of the key messages of our paper is that the official salary is only part of what MPs get from the job, financially. We focus on the outside employment MPs enjoy, which we are able to show directly resulted from their political roles, but liberal use of allowances of various kinds certainly could have helped make serving in Parliament pay off for some MPs.

"Regulating the financial lives of politicians to curb outside influence is a challenge everywhere. In the US Congress, members are paid about 50% more than MPs in the House of Commons, but their outside activity is much more restricted: members of Congress haven't been able to take on paid directorships, for example, since the late 1970s, while that continues in Parliament. On the other hand, Congressmen typically have a long list of campaign contributors to whom they are clearly beholden, so it's not as if money doesn't have an enormous influence - it's just that the money tends to go through campaign accounts rather than personal income."

Notes for Editors:

The article is available free of charge at:

The authors of the article are available for interview. Please see their contact details below:

Andrew Eggers:

Jens Hainmueller:

About the American Political Science Review

American Political Science Review is political science's premier scholarly research journal, providing peer-reviewed articles and review essays from subfields throughout the discipline. Areas covered include political theory, American politics, public policy, public administration, comparative politics, and international relations. APSR has published continuously since 1906.

ISSN: 0003-0554

eISSN: 1537-5943


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