"The Wages of Access"
Jordi Blanes i Vidal, Mirko Draca, and Christian Fons-Rosen from the LSE report in a new discussion paper (PDF) that lobbyist compensation is linked to legislator ties:
Washington’s “revolving door” – the movement from government service into the lobbying industry- is regarded as a major concern for policy-making. We study how ex-government staffers benefit from the personal connections acquired during their public service. Lobbyists with experience in the office of a US Senator suffer a 24% drop in generated revenue when that Senator leaves office. The effect is immediate, discontinuous around the exit period and long-lasting. Consistent with the notion that lobbyists sell access to powerful politicians, the drop in revenue is increasing in the seniority of and committee assignments power held by the exiting politician.
Of course this still leaves the nature of the policy impacts a somewhat open question. To some extent lobbyists make money by hustling their clients and pretending to offer services that aren’t, in fact, valuable. For example, there was a frenzy of lobbying in 2009 dedicated to making sure congress didn’t enact a new tax on sodas even though there was basically no congressional move to enact such a tax. Having an ex-boss in an important job on the Hill could be valuable for influencing policy or it could be valuable for acting like you’re in a position to influence policy. Or, of course, both.