Compensation Schemes and Human Capital Attainment in Congress: Is There an Adverse Selection of Legislator Attributes?

Abstract

This study examines the role that compensation plays in the self-selection process of legislator attributes in the U.S. Congress. The statistical results from the 104th Congress suggest that human capital levels of senators are significantly different from those of representatives, and this result is likely due to adverse selection because of the disparity in compensation schemes across the two chambers of the Congress. Such a result has potentially significant consequences given the constitutional provisions that place taxation authority in the U.S. House of Representatives, and the fact that House members sponsor vastly larger amounts of spending legislation (and total legislation) than senators. Although much future work is needed to be done, this study lays a foundation for public choice scholars to ponder.