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The Efficacy and Efforts of Interest Groups in Post Elections Policy Formation

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  • Gil S. Epstein
  • Yosef Mealem
  • Shmuel Nitzan

Abstract

This paper presents a new model of interest groups and policy formation in the legislature. In our setting, the already given party ideological predispositions and power distribution determine the expected policy outcome. Our analysis applies to the case of un-enforced or enforced party discipline as well as to two-party and multi-party (proportional representation) electoral systems. The interest groups’ objective is to influence the outcome in their favor by engaging in a contest that determines the final decision in the legislature. Our first result clarifies how the success of an interest group hinges on the dominance of its ideologically closer party and, in general, the coalition/opposition blocks of parties under un-enforced party or coalition/opposition discipline. Such dominance is defined in terms of ideological inclination weighted by power. Our second result clarifies how the success of an interest group hinges on the dominance of its ideology in the ruling coalition (party) in a majoritarian system with enforced coalition (party) discipline. We then clarify under what condition an interest group prefers to direct its lobbying efforts to two parties or the two coalition and opposition blocks of parties under un-enforced discipline rather than to the members of the ruling coalition (party) under enforced discipline. The lobbying efforts under un-enforced and enforced party discipline are also compared. Finally, we clarify the effect of ideological predispositions and power on the efforts of the interest groups.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 4009.

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Date of creation: 2012
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Handle: RePEc:ces:ceswps:_4009

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Keywords: policy formation; political parties; ideological predispositions; electoral power; post-elections lobbying; enforced party discipline;

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References

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  1. Che, Yeon-Koo & Gale, Ian L, 1998. "Caps on Political Lobbying," American Economic Review, American Economic Association, vol. 88(3), pages 643-51, June.
  2. Ramon Faulí-Oller & Efe A. Ok & Ignacio Ortuño-Ortín, 2003. "Delegation and polarization of platforms in political competition," Economic Theory, Springer, vol. 22(2), pages 289-309, 09.
  3. Cecilia Testa, 2004. "Party Polarization and Electoral Accountability," Econometric Society 2004 Latin American Meetings 130, Econometric Society.
  4. Epstein, Gil S. & Mealem, Yosef & Nitzan, Shmuel, 2011. "Political culture and discrimination in contests," Journal of Public Economics, Elsevier, vol. 95(1), pages 88-93.
  5. Jörg Franke & Christian Kanzow & Wolfgang Leininger & Alexandra Väth, 2009. "Effort Maximization in Asymmetric N-person Contest Games," Ruhr Economic Papers 0130, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
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  11. Matias Iaryczower & Andrea Mattozzi, 2012. "The pro-competitive effect of campaign limits in non-majoritarian elections," Economic Theory, Springer, vol. 49(3), pages 591-619, April.
  12. Jörg Franke & Christian Kanzow & Wolfgang Leininger & Alexandra Schwartz, 2013. "Effort maximization in asymmetric contest games with heterogeneous contestants," Economic Theory, Springer, vol. 52(2), pages 589-630, March.
  13. Coughlin, Peter & Nitzan, Shmuel, 1981. "Electoral outcomes with probabilistic voting and Nash social welfare maxima," Journal of Public Economics, Elsevier, vol. 15(1), pages 113-121, February.
  14. David P. Baron, 2006. "Competitive Lobbying and Supermajorities in a Majority-rule Institution," Scandinavian Journal of Economics, Wiley Blackwell, vol. 108(4), pages 607-642, December.
  15. Dixit, Avinash K, 1987. "Strategic Behavior in Contests," American Economic Review, American Economic Association, vol. 77(5), pages 891-98, December.
  16. van Winden, Frans, 1999. " On the Economic Theory of Interest Groups: Towards a Group Frame of Reference in Political Economics," Public Choice, Springer, vol. 100(1-2), pages 1-29, July.
  17. Donald Wittman, 2009. "How Pressure Groups Activate Voters and Move Candidates Closer to the Median," Economic Journal, Royal Economic Society, vol. 119(540), pages 1324-1343, October.
  18. Becker, Gary S, 1983. "A Theory of Competition among Pressure Groups for Political Influence," The Quarterly Journal of Economics, MIT Press, vol. 98(3), pages 371-400, August.
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