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The Structure of Political Institutions and Effectiveness of Corporate Political Lobbying

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  • Seong-Jin Choi

    (School of Business, Hanyang University, Seongdong-gu, Seoul 133-791, Republic of Korea)

  • Nan Jia

    (Marshall School of Business, University of Southern California, Los Angeles, California 90089)

  • Jiangyong Lu

    (Guanghua School of Management, Peking University, Beijing 100871, China)

Abstract

This paper investigates how the structure of political institutions influences the effectiveness of corporate political lobbying by shaping the “veto points” and “entry points” that lobbying firms encounter and require, respectively, when attempting to influence public policies; in so doing, this study deepens our understanding of the strategic implications of institutional environments. Using large-sample and cross-country firm-level data, we find that the influence of firms’ lobbying activities on public policies is weakened when there are tighter constraints generated as a result of greater political (partisan) competition and more subnational government tiers. We find that the negative association between the effectiveness of lobbying and political (partisan) competition is particularly pronounced in countries with lower electoral accountability and that the negative association between the effectiveness of lobbying and subnational government tiers is particularly pronounced in more centralized political systems.

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  • 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.
    • Handle: RePEc:inm:ororsc:v:26:y:2015:i:1:p:158-179
    DOI: 10.1287/orsc.2014.0936
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