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Do More Powerful Interest Groups have a Disproportionate Influence on Policy?

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  • Zara Sharif

    (Erasmus University Rotterdam)

  • Otto H. Swank

    (Erasmus University Rotterdam)

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    Abstract

    Decisions-makers often rely on information supplied by interested parties. In practice, some parties have easier access to information than other parties. In this light, we examine whether more powerful parties have a disproportionate influence on decisions. We show that more powerful parties influence decisions with higher probability. However, in expected terms, decisions do not depend on the relative strength of interested parties. When parties have not provided information, decisions are biased towards the less powerful parties. Finally, we show that compelling parties to supply information destroys incentives to collect information.

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    Bibliographic Info

    Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 12-134/VII.

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    Date of creation: 05 Dec 2012
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    Handle: RePEc:dgr:uvatin:20120134

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    Web page: http://www.tinbergen.nl

    Related research

    Keywords: information collection; communication; interest groups; decision-making;

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    1. Vijay Krishna & John Morgan, 1999. "A Model of Expertise," Working Papers 154, Princeton University, Woodrow Wilson School of Public and International Affairs, Discussion Papers in Economics..
    2. Shin Hyun Song, 1994. "The Burden of Proof in a Game of Persuasion," Journal of Economic Theory, Elsevier, vol. 64(1), pages 253-264, October.
    3. Paul R. Milgrom & John Roberts, 1985. "Relying on the Information of Interested Parties," Cowles Foundation Discussion Papers 749, Cowles Foundation for Research in Economics, Yale University.
    4. Potters, J.J.M. & Winden, F. van, 1992. "Lobbying and asymmetric information," Open Access publications from Tilburg University urn:nbn:nl:ui:12-223989, Tilburg University.
    5. Robert Dur & Otto H. Swank, 2003. "Producing and Manipulating Information," CESifo Working Paper Series 908, CESifo Group Munich.
    6. Thomas Stratmann, 2005. "Some talk: Money in politics. A (partial) review of the literature," Public Choice, Springer, vol. 124(1), pages 135-156, July.
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