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Protection, Lobbying, and Market Structure

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  • Arye Hillman
  • Ngo Van Long

    ()

  • Antoine Soubeyran

Abstract

We analyze a model of lobbying by oligopolists who allocate resources between lobbying and internal cost-reducing activities. We ask the following questions: (i) if firms differ with respect to comparative advantage in lobbying, what is the equilibrium allocation of resources between lobbying and cost-reducing activities? (ii) can the possibility of lobbying reverse the profitability ranking among firms? (iii) under what condition is the conventional wisdom (that highly concentrated industries tend to obtain more protection) valid? On analyse un modèle de lobbying par des entrepreneurs qui allouent leur temps entre les activités de supervision. On donne des réponses aux questions suivantes: (i) quelles sont les allocations de ressources en équilibre? Le lobbying pourrait-il renverser l'ordre de rentabilité parmi les firmes? (iii) y a-t-il une corrélation entre le degré de concentration d'une industrie et la protection qu'elle obtient du gouvernement?

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Bibliographic Info

Paper provided by CIRANO in its series CIRANO Working Papers with number 2000s-12.

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Date of creation: 01 Apr 2000
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Handle: RePEc:cir:cirwor:2000s-12

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Keywords: Lobbying; oligopoly; protection; quota; Lobbying; oligopole; protection; quota;

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  1. Potters, J.J.M. & Sloof, R. & Winden, F.A.A.M. van, 1997. "Campaign Expenditures, Contributions and Direct Endorsements: The Strategic Use of Information and Money to Influence Voter Behavior," Discussion Paper 1997-27, Tilburg University, Center for Economic Research.
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  3. Mayer, Wolfgang, 1998. "Trade Policy Platforms of Competing Parties: What Makes Them Different?," Review of International Economics, Wiley Blackwell, vol. 6(2), pages 185-203, May.
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  7. Vousden, Neil & Campbell, Neil, 1994. "The organizational cost of protection," Journal of International Economics, Elsevier, vol. 37(3-4), pages 219-238, November.
  8. Ngo Van Long & Antoine Soubeyran, 1999. "Cost Manipulation Games in Oligopoly, with Costs of Manipulating," CIRANO Working Papers 99s-13, CIRANO.
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  13. Giovanni Maggi & Pinelopi Koujianou Goldberg, 1999. "Protection for Sale: An Empirical Investigation," American Economic Review, American Economic Association, vol. 89(5), pages 1135-1155, December.
  14. Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, vol. 29(1), pages 25-49, February.
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  17. Baldwin, Robert E., 1984. "Trade policies in developed countries," Handbook of International Economics, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 12, pages 571-619 Elsevier.
  18. Cassing, James H., 1996. "Protectionist mutual funds," European Journal of Political Economy, Elsevier, vol. 12(1), pages 1-18, April.
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  21. Long, Ngo Van & Soubeyran, Antoine, 1996. "Lobbying for protection by heterogeneous firms," European Journal of Political Economy, Elsevier, vol. 12(1), pages 19-32, April.
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Citations

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Cited by:
  1. Andrew Dick, 1995. "Explaining Managed Trade as Rational Cheating (Forthcoming in Review of International Economics)," UCLA Economics Working Papers 730, UCLA Department of Economics.
  2. Tomaso Duso & Astrid Jung, 2002. "Market Conduct and Endogenous Lobbying: Evidence from the U.S. Mobile Telecommunications Industry," CIG Working Papers FS IV 02-35, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).
  3. Matilde Bombardini & Francesco Trebbi, 2009. "Competition and Political Organization: Together or Alone in Lobbying for Trade Policy?," NBER Working Papers 14771, National Bureau of Economic Research, Inc.
  4. Samia Tavares, 2006. "The political economy of the European customs classification," Public Choice, Springer, vol. 129(1), pages 107-130, October.
  5. Ngo Van Long & Antoine Soubeyran, 2003. "A Theory of Favoritism under International Oligopoly," CIRANO Working Papers 2003s-15, CIRANO.
  6. Lasserre, Pierre & Soubeyran, Antoine, 2003. "A Ricardian model of the tragedy of the commons," Journal of Economic Behavior & Organization, Elsevier, vol. 50(1), pages 29-45, January.
  7. Tavares, Samia, 2006. "Deeper Integration and Voting on the Common European External Tariff," MPRA Paper 960, University Library of Munich, Germany.
  8. Tavares, Samia, 2006. "The Common External Tariff in a Customs Union: Voting, Logrolling, and National Government Interests," MPRA Paper 959, University Library of Munich, Germany.
  9. Koziashvili, Arkadi & Nitzan, Shmuel & Tobol, Yossef, 2010. "Bureaucracy Norms and Market Size," Economics Series 259, Institute for Advanced Studies.
  10. kishore gawande & pravin krishna, 2005. "The Political Economy of Trade Policy: Empirical Approaches," International Trade 0503003, EconWPA.
  11. Panagariya, Arvind & Findlay, Ronald & DEC, 1994. "A political - economy analysis of free trade areas and customs unions," Policy Research Working Paper Series 1261, The World Bank.
  12. Kim, Young-Han & Kim, Sang-Kee, 2012. "Welfare effects of competitive lobbying efforts in international oligopoly markets," Economic Modelling, Elsevier, vol. 29(3), pages 614-620.

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