Revolving doors in sovereign debt management

Compiling a longitudinal data set describing the career trajectories of circa 300 public officials across 15 European countries, this article assesses the revolving door phenomenon in sovereign debt management. By listing information of employees in office at agencies borrowing on behalf of the government, the study constitutes an account of public debt management’s professionalisation at the time of data gathering. The analysis’ commitment is to measure the share of public servants who nurtured experience at financial institutions entitled to participate in government bond auctions (primary dealers), and to investigate the phenomenon’s determinants. Information about career paths has been retrieved from social media, press releases, official curricula and databases (Dow Jones). Data analysis tasks have been carried out drawing on sequence analysis and optimal matching. The former to deploy summary statistics and the latter to measure the degree of dissimilarity across career trajectories. Further, social network analysis serves to portray the public servant-primary dealer link, and to assess the phenomenon’s significance. The main finding is that debt managers belong to three types of professional ecologies: investment banking, professional services and public sector. Significantly, 40% of the sample matured experience at primary dealers before being appointed public servant. In particular, chief executive officers and traders are the roles mostly affected by the phenomenon. The results suggest close ties between debt management offices and financial institutions. The interpretation may, however, work in two ways: sovereigns may benefit from the expertise and personal networks of their employees – on the other hand, the interlinkages may give rise to material and intellectual capture. Further, the data set contributes to the literature in both the management science and the political economy of sovereign debt management. The former paving the way to future analyses estimating the impact of employees’ background on government funding costs, and the latter embedding the research on public debt management’s financialisation in additional empirical evidence.