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Academic Earmarks and the Returns to Lobbying

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Author Info
De Figueiredo, John M.
Silverman, Brian S.

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Abstract

Despite a large literature on lobbying and information transmission by interest groups, no prior study has measured returns to lobbying. In this paper, we statistically estimate the returns to lobbying by universities for educational earmarks (which now represent 10 percent of federal funding of university research). The returns to lobbying approximate zero for universities not represented by a member of the Senate Appropriations Committee (SAC) or House Appropriations Committee (HAC). However, the average lobbying university with representation on the SAC receives an average return to one dollar of lobbying of $11-$17; lobbying universities with representation on the HAC obtain $20-$36 for each dollar spent. Moreover, we cannot reject the hypothesis that lobbying universities with SAC or HAC representation set the marginal benefit of lobbying equal to its marginal cost, although the large majority of universities with representation on the HAC and SAC do not lobby, and thus do not take advantage of their representation in Congress. On average, 45 percent of universities are predicted to choose the optimal level of lobbying. In addition to addressing questions about the federal funding of university research, we also discuss the impact of our results for the structure of government.

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Paper provided by Massachusetts Institute of Technology (MIT), Sloan School of Management in its series Working papers with number 4245-02.

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Date of creation: 05 Jun 2002
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Handle: RePEc:mit:sloanp:667

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Postal: MASSACHUSETTS INSTITUTE OF TECHNOLOGY (MIT), SLOAN SCHOOL OF MANAGEMENT, 50 MEMORIAL DRIVE CAMBRIDGE MASSACHUSETTS 02142 USA

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Keywords: Returns to Lobbying; Federal Funding of University; University Lobbying;

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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. La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert, 1999. "The Quality of Government," Journal of Law, Economics and Organization, Oxford University Press, vol. 15(1), pages 222-79, April.
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  2. A. Abigail Payne & Aloysius Siow, 1998. "Estimating the Effects of Federal Research Funding on Universities using Alumni Representation on Congressional Appropriations Committees," Working Papers siow-99-02, University of Toronto, Department of Economics. [Downloadable!]
  3. Randall S. Kroszner & Philip E. Strahan, 1999. "What Drives Deregulation? Economics And Politics Of The Relaxation Of Bank Branching Restrictions," The Quarterly Journal of Economics, MIT Press, vol. 114(4), pages 1437-1467, November. [Downloadable!] (restricted)
  4. Murphy, Kevin M & Shleifer, Andrei & Vishny, Robert W, 1993. "Why Is Rent-Seeking So Costly to Growth?," American Economic Review, American Economic Association, vol. 83(2), pages 409-14, May. [Downloadable!] (restricted)
  5. Snyder, James M, Jr, 1992. "Long-Term Investing in Politicians; or, Give Early, Give Often," Journal of Law & Economics, University of Chicago Press, vol. 35(1), pages 15-43, April.
  6. Julio J. Rotemberg, 2003. "Commercial Policy with Altruistic Voters," Journal of Political Economy, University of Chicago Press, vol. 111(1), pages 174-201, February. [Downloadable!] (restricted)
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  7. Rosenberg, Nathan & Nelson, Richard R., 1994. "American universities and technical advance in industry," Research Policy, Elsevier, vol. 23(3), pages 323-348, May. [Downloadable!] (restricted)
  8. Levitt, Steven D & Snyder, James M, Jr, 1997. "The Impact of Federal Spending on House Election Outcomes," Journal of Political Economy, University of Chicago Press, vol. 105(1), pages 30-53, February.
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  9. repec:bep:buspol:2:2000:1:75-88 is not listed on IDEAS
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  10. 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. [Downloadable!] (restricted)
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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. A Abigail Payne, 2001. "Do Congressional Earmarks Increase Research Output at Universities?," Public Economics 0111002, EconWPA. [Downloadable!]
  2. John M. de Figueriedo, 2004. "The Timing, Intensity, and Composition of Interest Group Lobbying: An Analysis of Structural Policy Windows in the States," NBER Working Papers 10588, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  3. John de Figueiredo, . "The Timing, Intensity, and Composition of Interest Group Lobbying: An Analysis of Structural Policy Windows in the States," American Law & Economics Association Annual Meetings 1082, American Law & Economics Association. [Downloadable!]
  4. De Figueiredo, John M. & De Figueiredo, Rui J. P. Jr., 2002. "Managerial Decision-Making in Non-Market Environments: A Survey Experiment," Working papers 4246-02, Massachusetts Institute of Technology (MIT), Sloan School of Management. [Downloadable!]
  5. James D. Adams & J. Roger Clemmons, 2006. "The Growing Allocative Inefficiency of the U.S. Higher Education Sector," Rensselaer Working Papers in Economics 0611, Rensselaer Polytechnic Institute, Department of Economics. [Downloadable!]
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