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The Influence of Firms on Government

Author

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  • Macher Jeffrey T

    (Georgetown University)

  • Mayo John W

    (Georgetown University)

  • Schiffer Mirjam

    (Secretariat of the Swiss Competition Commission)

Abstract

While interest group explanations have considerably advanced our understanding of governmental outcomes, much remains to be understood about the specific country-level, industry-level and firm-level characteristics that underlie the influence firms have on the establishment of governmental rules, laws and regulations. In this study, we draw upon a unique database of roughly 6000 international firms to investigate the abilities of firms to affect governmental policies. We find that country-level institutional characteristics, such as the legal origin and political diversity of the firm’s home country, significantly affect the ability to influence government. We also find that industry-level characteristics, such as the number of industry competitors, and firm-level characteristics, such as size and age, are determinants of firm influence on governments.

Suggested Citation

  • Macher Jeffrey T & Mayo John W & Schiffer Mirjam, 2011. "The Influence of Firms on Government," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 11(1), pages 1-27, January.
    • Handle: RePEc:bpj:bejeap:v:11:y:2011:i:1:n:1
    DOI: 10.2202/1935-1682.2153
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    References listed on IDEAS

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    Cited by:

    1. Papadimitri, Panagiota & Pasiouras, Fotios & Pescetto, Gioia & Wohlschlegel, Ansgar, 2021. "Does political influence distort banking regulation? Evidence from the US," Journal of Financial Stability, Elsevier, vol. 53(C).
    2. Vijaya Subrahmanyam & Manohar Singh & Anita Pennathur, 2020. "CEO characteristics, firm performance, and corporate political contributions: A firm level pre‐Citizens United analysis," Review of Financial Economics, John Wiley & Sons, vol. 38(2), pages 379-404, April.
    3. Angela Garcia Calvo, 2014. "The Role of State-Firm Relationships in Fostering Competitiveness: Telefonica’s Upgrading," Carlo Alberto Notebooks 397, Collegio Carlo Alberto.
    4. James Lake & Maia Linask, 2016. "Domestic political competition and pro-cyclical import protection," Review of International Economics, Wiley Blackwell, vol. 24(3), pages 564-591, August.
    5. Jeffrey Macher & John Mayo, 2012. "The World of Regulatory Influence," Journal of Regulatory Economics, Springer, vol. 41(1), pages 59-79, February.
    6. Wöcke, Albert & Moodley, Terence, 2015. "Corporate political strategy and liability of foreignness: Similarities and differences between local and foreign firms in the South African Health Sector," International Business Review, Elsevier, vol. 24(4), pages 700-709.
    7. Lee, Jeoung Yul & Jiménez, Alfredo & Choi, Seong-jin & Choi, Yun Hyeong, 2022. "Ideological polarization and corporate lobbying activity: The contingent impact of corruption distance," Journal of Business Research, Elsevier, vol. 141(C), pages 448-461.
    8. Mario Bazán & Francisco Sagasti & Raúl Cárdenas, 2014. "National system of innovation for inclusive development: achievements and challenges in Peru," Chapters, in: Gabriela Dutrénit & Judith Sutz (ed.), National Innovation Systems, Social Inclusion and Development, chapter 6, pages 169-198, Edward Elgar Publishing.
    9. Seong-Jin Choi & Nan Jia & Jiangyong Lu, 2015. "The Structure of Political Institutions and Effectiveness of Corporate Political Lobbying," Organization Science, INFORMS, vol. 26(1), pages 158-179, February.

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