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Interest Group Politics and Economic Growth in the U.S. States

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  • Gray, Virginia
  • Lowery, David

Abstract

Mancur Olson's model of economic growth has attracted great attention as a theoretical account of how interest groups influence the rate of economic growth over time. Moreover, the model appears to have received strong empirical support in Olson's tests employing U.S. state data. However, the specification of the Olson construct in these tests is insufficiently attentive to the complex causal chain implicit in Olson's argument, inadequately accounts for precisely how interest groups matter, and employs a static research design that obfuscates the cause-and-effect relationships posited by the model. We review these issues and develop a more complete specification of the Olson model. The respecified model is then tested using U.S. state data for the period of the late 1970s and early 1980s using new measures of interest-group influence.

Suggested Citation

  • Gray, Virginia & Lowery, David, 1988. "Interest Group Politics and Economic Growth in the U.S. States," American Political Science Review, Cambridge University Press, vol. 82(1), pages 109-131, March.
    • Handle: RePEc:cup:apsrev:v:82:y:1988:i:01:p:109-131_08
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    Cited by:

    1. William Pyle & Laura Solanko, 2013. "The composition and interests of Russia’s business lobbies: testing Olson’s hypothesis of the “encompassing organization”," Public Choice, Springer, vol. 155(1), pages 19-41, April.
    2. Brunk, Gregory G. & Hunter, Kennith G., 2008. "An ecological perspective on interest groups and economic stagnation," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(1), pages 194-212, February.
    3. Liedong, Tahiru Azaaviele & Rajwani, Tazeeb & Lawton, Thomas C., 2020. "Information and nonmarket strategy: Conceptualizing the interrelationship between big data and corporate political activity," Technological Forecasting and Social Change, Elsevier, vol. 157(C).
    4. Michele Hoyman & Jamie McCall & Laurie Paarlberg & John Brennan, 2016. "Considering the Role of Social Capital for Economic Development Outcomes in U.S. Counties," Economic Development Quarterly, , vol. 30(4), pages 342-357, November.
    5. Theresa Hager, 2020. "Special Interest Groups and Growth: A Meta-Analysis of Mancur Olsons Theory," ICAE Working Papers 116, Johannes Kepler University, Institute for Comprehensive Analysis of the Economy.
    6. Broscheid, Andreas, 2005. "Ending Cooperation: A Formal Model of Organizational Change in German Pharmaceutical Interest Representation," MPIfG Discussion Paper 05/9, Max Planck Institute for the Study of Societies.
    7. Ismail M. Cole, 2023. "The political economy triangle of government spending, interest‐group influence, and income inequality: Evidence and implications from the US states," Economics and Politics, Wiley Blackwell, vol. 35(3), pages 1122-1176, November.
    8. Coates, Dennis & Heckelman, Jac C. & Wilson, Bonnie, 2010. "The political economy of investment: Sclerotic effects from interest groups," European Journal of Political Economy, Elsevier, vol. 26(2), pages 208-221, June.
    9. Caporale, Tony & Leirer, Jonathan, 2010. "Take the money and run: Political turnover, rent-seeking and economic growth," Journal of Economic Behavior & Organization, Elsevier, vol. 76(2), pages 406-412, November.
    10. Lane Kenworthy, 2003. "An Equality-Growth Tradeoff?," LIS Working papers 362, LIS Cross-National Data Center in Luxembourg.
    11. Cole, Ismail M., 2014. "Short- and long-term growth effects of special interest groups in the U.S. states: A dynamic panel error-correction approach," MPRA Paper 54455, University Library of Munich, Germany, revised 02 Mar 2014.
    12. Francis G. Castles & Steve Dowrick, 1990. "The Impact of Government Spending Levels on Medium-Term Economic Growth in the Oecd, 1960-85," Journal of Theoretical Politics, , vol. 2(2), pages 173-204, April.
    13. James W. Stoutenborough & Matthew Beverlin, 2008. "Encouraging Pollution‐Free Energy: The Diffusion of State Net Metering Policies," Social Science Quarterly, Southwestern Social Science Association, vol. 89(5), pages 1230-1251, December.
    14. Eloranta, Jari, 2004. "WARFARE AND WELFARE? Understanding 19th and 20th Century Central Government Spending," The Warwick Economics Research Paper Series (TWERPS) 699, University of Warwick, Department of Economics.
    15. Ivo Bischoff, 2007. "Model Uncertainty, Political Learning, and Institutions: A Broader View on Mancur Olson's Theory of Institutional Sclerosis," Southern Economic Journal, John Wiley & Sons, vol. 74(1), pages 34-49, July.
    16. Robert F. Salvino & Gregory M. Randolph & Geoffrey K. Turnbull & Michael T. Tasto, 2019. "The effects of decentralization on special interest groups," Public Choice, Springer, vol. 181(3), pages 191-213, December.
    17. Jac C. Heckelman, 2007. "Explaining the Rain: The Rise and Decline of Nations after 25 Years," Southern Economic Journal, John Wiley & Sons, vol. 74(1), pages 18-33, July.

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