Abstract:We develop a model in which firms within an industry can pool their resources to lobby collectively in an association. Our model departs from previous accounts stressing productive efficiencies of col...We develop a model in which firms within an industry can pool their resources to lobby collectively in an association. Our model departs from previous accounts stressing productive efficiencies of collective political action (e.g., sharing fixed administrative costs), by treating associational lobbying as a means by which firms can credibly convey information to politicians about the distribution of a regulatory policy’s costs in the industry. Unlike canonical accounts of collective political action based on Olson’s (1965) seminal work, we show that in expectation, a regulatory mandate will be more stringent (and thus harmful) to firms in an equilibrium with an association than in an equilibrium without an association. Nonetheless, some firms may find it advantageous to create such an association, and others will feel compelled to contribute to one should it exist. We also demonstrate that the provision of selective benefits will tend to expand the scope of an association’s membership, but may simultaneously undermine the efficacy of the group’s political activity.Read More
Publication Year: 2010
Publication Date: 2010-01-01
Language: en
Type: article
Access and Citation
AI Researcher Chatbot
Get quick answers to your questions about the article from our AI researcher chatbot