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Endogenous Lobbying

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Author Info
Felli, Leonhardo
Merlo, Antonio

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Abstract

In this paper we endogenize the number and characteristics of lobbies in a citizen-candidate model of representative democracy where citizens can lobby an elected policy-maker. We find that lobbying always matters. That is, lobbying always affects equilibrium policy outcomes. Moreover, only one policy outcome emerges in equilibrium. An "extremist" candidate is elected and implements a "centrist" policy that differs from the one most preferred by the median voter. These results are in contrast with the ones obtained in the context of a citizen-candidate model where lobbies are exogenous.

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Paper provided by CESifo GmbH in its series CESifo Working Paper Series with number CESifo Working Paper No. 291.

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Date of creation: 2000
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Handle: RePEc:ces:ceswps:_291

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Related research
Keywords: Lobbying citizen-candidate representative democracy electoral competition

Other versions of this item:

Find related papers by JEL classification:
D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Models of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior
D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy-Making and Implementation

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Helpman, E. & Persson, T., 1998. "Lobbying and Legislative Bargaining," Papers 08-98, Tel Aviv.
    Other versions:
  2. Persson, Torsten & Tabellini, Guido, 1997. "Political Economics and Macroeconomic Policy," CEPR Discussion Papers 1759, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  3. Wittman, Donald, 1977. "Candidates with policy preferences: A dynamic model," Journal of Economic Theory, Elsevier, vol. 14(1), pages 180-189, February. [Downloadable!] (restricted)
  4. Grossman, Gene M & Helpman, Elhanan, 1994. "Protection for Sale," American Economic Review, American Economic Association, vol. 84(4), pages 833-50, September. [Downloadable!] (restricted)
    Other versions:
  5. Osborne, Martin J & Slivinski, Al, 1996. "A Model of Political Competition with Citizen-Candidates," The Quarterly Journal of Economics, MIT Press, vol. 111(1), pages 65-96, February. [Downloadable!] (restricted)
    Other versions:
  6. Levy, Gilat, 2004. "A model of political parties," Journal of Economic Theory, Elsevier, vol. 115(2), pages 250-277, April. [Downloadable!] (restricted)
  7. Diermeier, Daniel & Merlo, Antonio, 2000. "Government Turnover in Parliamentary Democracies," Journal of Economic Theory, Elsevier, vol. 94(1), pages 46-79, September. [Downloadable!] (restricted)
    Other versions:
  8. Daniel Diermeier & Michael Keane & Antonio Merlo, 2002. "A Political Economy Model of Congressional Careers," PIER Working Paper Archive 04-037, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 01 Sep 2004. [Downloadable!]
    Other versions:
  9. Grossman, Gene M & Helpman, Elhanan, 1996. "Electoral Competition and Special Interest Politics," Review of Economic Studies, Blackwell Publishing, vol. 63(2), pages 265-86, April. [Downloadable!] (restricted)
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  10. Bagnoli, Mark & Lipman, Barton L, 1989. "Provision of Public Goods: Fully Implementing the Core through Private Contributions," Review of Economic Studies, Blackwell Publishing, vol. 56(4), pages 583-601, October. [Downloadable!] (restricted)
  11. Tim Besley & Stephen Coate, . ""An Economic Model of Representative Democracy''," CARESS Working Papres 95-02, University of Pennsylvania Center for Analytic Research and Economics in the Social Sciences. [Downloadable!]
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  12. Dixit, Avinash & Grossman, Gene M & Helpman, Elhanan, 1997. "Common Agency and Coordination: General Theory and Application to Government Policy Making," Journal of Political Economy, University of Chicago Press, vol. 105(4), pages 752-69, August.
  13. Alesina, Alberto, 1988. "Credibility and Policy Convergence in a Two-Party System with Rational Voters," American Economic Review, American Economic Association, vol. 78(4), pages 496-805, September.
  14. Bernheim, B Douglas & Whinston, Michael D, 1986. "Menu Auctions, Resource Allocation, and Economic Influence," The Quarterly Journal of Economics, MIT Press, vol. 101(1), pages 1-31, February. [Downloadable!] (restricted)
  15. Massimo Morelli, 2004. "Party Formation and Policy Outcomes under Different Electoral Systems," Review of Economic Studies, Blackwell Publishing, vol. 71, pages 829-853, 07. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Vincent Anesi, 2007. "Moral Hazard and Free Riding in Collective Action," Discussion Papers 2007-04, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham. [Downloadable!]
  2. Keefer, Philip, 2001. "When do special interests run rampant ? disentangling the role in banking crises of elections, incomplete information, and checks and balances," Policy Research Working Paper Series 2543, The World Bank. [Downloadable!]
  3. Börner, Kira, 2004. "Political Economy Reasons for Government Inertia: The Role of Interest Groups in the Case of Access to Medicines," Discussion Papers in Economics 313, University of Munich, Department of Economics. [Downloadable!]
  4. Topi Miettinen & Panu Poutvaara, 2006. "Political Parties and Network Formation," IZA Discussion Papers 1918, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  5. Redoano, Michela, 2003. "Does Centralisation Affect The Number And Size Of Lobbies?," The Warwick Economics Research Paper Series (TWERPS) 674, University of Warwick, Department of Economics. [Downloadable!]
    Other versions:
  6. Topi Miettinen & Panu Poutvaara, 2007. "Political Parties and Rent-seeking through Networks," Discussion Papers on Strategic Interaction 2006-28, Max Planck Institute of Economics, Strategic Interaction Group. [Downloadable!]
  7. Afontsev Serguey, 2004. "Political economy of tariff unification: the case of Russia," EERC Working Paper Series 04-12e, EERC Research Network, Russia and CIS. [Downloadable!]
  8. Martimort, David & Semenov, Aggey, 2008. "Ideological Uncertainty and Lobbying Competition," MPRA Paper 6992, University Library of Munich, Germany. [Downloadable!]
    Other versions:
  9. Antonio Merlo, 2005. "Whither Political Economy? Theories, Facts and Issues," PIER Working Paper Archive 05-033, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 01 Dec 2005. [Downloadable!]
  10. Richard E. Baldwin & Frédéric Robert-Nicoud, 2007. "Entry and Asymmetric Lobbying: Why Governments Pick Losers," CEP Discussion Papers dp0791, Centre for Economic Performance, LSE. [Downloadable!]
    Other versions:
  11. Bordignon, Massimo & Colombo, Luca & Galmarini, Umberto, 2003. "Fiscal Federalism and Endogenous Lobbies' Formation," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
  12. Boerner, Kira, 2005. "Having Everyone in the Boat May Sink it - Interest Group Involvement and Policy Reforms," Discussion Papers in Economics 730, University of Munich, Department of Economics. [Downloadable!]
  13. Jon X. Eguia, 2003. "Is the Status Quo Relevant in a Representative Democracy?," Working Papers 1176, California Institute of Technology, Division of the Humanities and Social Sciences. [Downloadable!]
  14. Reuben E., 2002. "Interest groups and politics: The need to concentrate on group formation," Public Economics 0212001, EconWPA. [Downloadable!]
  15. Houda Haffoudhi, 2005. "The logic of two-level games with endogenous lobbying : the case of international environmental agreements," Cahiers de la Maison des Sciences Economiques j05054, Université Panthéon-Sorbonne (Paris 1). [Downloadable!]
  16. Gil S. Epstein & Shmuel Nitzan, 2005. "Lobbying and Compromise," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
  17. Giorgio Bellettini & Hubert Kempf, 2008. "Why not in your Backyard? On the Location and Size of a Public Facility," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
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This page was last updated on 2008-9-22.

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