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Access Fees in Politics

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Author Info
Christopher Cotton () (Department of Economics, Cornell University)

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Abstract

This paper develops a game-theoretic model of lobbying in which a politician sells access to interest groups. The politician sets an access fee, or the minimum contribution necessary to secure access, and an interest group that pays this fee can share verifiable evidence in favor of its preferred policy. The more the politician knows about interest group evidence, the better able he is to identify and implement the welfare-maximizing policy. In equilibrium, a wealthy interest group must pay more for access than an otherwise similar poor group; and a group involved with an important issue must pay less than an otherwise similar group involved with a less-important issue. The politician sets higher-than-optimal access fees in order to increase contributions. A contribution limit can improve constituent welfare by lowering the price of access, which tends to result in a more-informed politician. However, a limit can also decrease the range of issues for which the politician is willing to sell access, thereby reducing politician information and constituent welfare. Although the optimal limit is binding for some issues, it is never optimal to ban contributions.

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File URL: http://www.bus.miami.edu/_assets/files/faculty-and-research/academic-departments/eco/eco-working-papers/wp2009-03-AccessFeesPolitics.pdf
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File Function: First version, 2008
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Publisher Info
Paper provided by University of Miami, Department of Economics in its series Working Papers with number 0903.

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Length: 35 pages
Date of creation: 09 Jun 2008
Date of revision:
Handle: RePEc:mia:wpaper:0903

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Related research
Keywords: Lobbying; campaign contributions; contribution limits; political access; hard information; evidence disclosure;

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
D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information

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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. Austen-Smith, David, 1998. "Allocating Access for Information and Contributions," Journal of Law, Economics and Organization, Oxford University Press, vol. 14(2), pages 277-303, October.
  2. Lipman Barton L. & Seppi Duane J., 1995. "Robust Inference in Communication Games with Partial Provability," Journal of Economic Theory, Elsevier, vol. 66(2), pages 370-405, August. [Downloadable!] (restricted)
  3. Paul Milgrom & John Roberts, 1986. "Relying on the Information of Interested Parties," RAND Journal of Economics, The RAND Corporation, vol. 17(1), pages 18-32, Spring. [Downloadable!] (restricted)
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  4. repec:bep:buspol:2:2000:1:75-88 is not listed on IDEAS
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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. Christopher Cotton, 2008. "Should We Tax or Cap Political Contributions? A Lobbying Model with Policy Favors and Access," Working Papers 0901, University of Miami, Department of Economics. [Downloadable!]
    Other versions:
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This page was last updated on 2009-11-18.

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