What is the “revolving door”?
After completing their bureaucratic or political terms, heads of state agencies are entering the very sector they have formerly regulated. Conversely, it is common to see private sector executives joining public sector agencies and exerting regulatory responsibilities over their initial private industries. In both cases, there is a significant risk that public responsibilities held by these “revolved regulators” be undermined by concomitant private interests. Such situations are referred as conflicts of interest.
The revolving door has been pinpointed by the OECD as having bad effects on the economy, and even as being one major cause of the 2008 crisis. This phenomenon, common in most industrialized countries, leads to conflicts of interest that may seriously distort economies.
By measuring the concentration of revolved regulators among private firms, the revolving door indicator measures the inequality of influence of politically-connected firms, thereby highlighting one key process through which conflicts of interest arise.
Version : 2015-03-01
Data collected by the authors from official company websites, LexisNexis Academic, and OneSource (Avention), and cross-checked with data from OpenSecrets.org website and biographies provided by government agency websites (Securities and Exchange Commission and Treasury), social network websites (LinkedIn), and business websites (Businessweek, Business Insider, Bloomberg).