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Heterogenous Groups and Rent-Seeking for Public Goods

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  • Cheikbossian, Guillaume

Abstract

We present a model of endogenous public good provision and group rent-seeking influence e.g. lobbying. Specifically, two groups with different preferences over public good consumption and different sizes engage in rent-seeking activities to influence policymaking in their preferred direction. When there is within-group cooperation in lobbying, both groups neutralize each other in the political process. Without within-group cooperation, the free-rider problem in lobbying makes the smaller group politically influent. In both cases, rent-seeking by each group is increasing in the degree of preference heterogeneity and in membership size of both groups.

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Bibliographic Info

Paper provided by LASER (Laboratoire de Science Economique de Richter), Faculty of Economics, University of Montpellier 1 in its series Cahiers du LASER (LASER Working Papers) with number 2005.16.

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Length: 20 pages
Date of creation: 2005
Date of revision:
Handle: RePEc:mop:lasrwp:2005.16

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Postal: LASER, Faculté d'Economie, Avenue Raymond Dugrand, CS 79606, 34960 MONTPELLIER Cedex 2, France
Web page: http://www.laser.univ-montp1.fr
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Keywords: Public Goods; Rent-seeking; Free-rider problem;

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References

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  1. Lorz, Jens Oliver, 1996. "Capital mobility, tax competition, and lobbying for redistributive capital taxation," Kiel Working Papers 779, Kiel Institute for the World Economy.
  2. Katz, Eliakim & Nitzan, Shmuel & Rosenberg, Jacob, 1990. " Rent-Seeking for Pure Public Goods," Public Choice, Springer, vol. 65(1), pages 49-60, April.
  3. Coughlin, Peter J & Mueller, Dennis C & Murrell, Peter, 1990. "Electoral Politics, Interest Groups, and the Size of Government," Economic Inquiry, Western Economic Association International, vol. 28(4), pages 682-705, October.
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  8. Guillaume CHEIKBOSSIAN, 2004. "Lobbying and Rent-Seeking for Public Goods in a Fiscally Centralized system," Annales d'Economie et de Statistique, ENSAE, issue 75-76, pages 331-351.
  9. Magee,Stephen P. & Brock,William A. & Young,Leslie, 1989. "Black Hole Tariffs and Endogenous Policy Theory," Cambridge Books, Cambridge University Press, number 9780521362474, April.
  10. Aidt, Toke Skovsgaard, 1997. " Cooperative Lobbying and Endogenous Trade Policy," Public Choice, Springer, vol. 93(3-4), pages 455-75, December.
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Citations

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Cited by:
  1. Oskar Nupia, 2011. "Rent-seeking For Public Goods: Group´s Size and Wealth Heterogeneity," DOCUMENTOS CEDE 008914, UNIVERSIDAD DE LOS ANDES-CEDE.
  2. Heinrich Ursprung, 2011. "The Evolution of Sharing Rules in Rent Seeking Contests: Incentives Crowd Out Cooperation," Working Paper Series of the Department of Economics, University of Konstanz 2011-02, Department of Economics, University of Konstanz.
  3. Toshihiro Ihori & C.C. Yang, 2010. "Laffer paradox, Leviathan, and Political Contest," CIRJE F-Series CIRJE-F-769, CIRJE, Faculty of Economics, University of Tokyo.
  4. Gil S. Epstein & Yosef Mealem, 2011. "Cooperation and Effort in Group Contests," Working Papers 2011-28, Department of Economics, Bar-Ilan University.
  5. Elie Appelbaum & Eliakim Katz, 1986. "Transfer seeking and avoidance: On the full social costs of rent seeking," Public Choice, Springer, vol. 48(2), pages 175-181, January.
  6. Dan Kovenock J. & Brian Roberson, 2009. "Non-Partisan 'Get-Out-the-Vote' Efforts and Policy Outcomes," CESifo Working Paper Series 2815, CESifo Group Munich.
  7. Sheremeta, Roman, 2009. "Essays on Experimental Investigation of Lottery Contests," MPRA Paper 49888, University Library of Munich, Germany.
  8. Hattori, Keisuke, 2011. "A Note on Within-group Cooperation and Between-group Interaction in the Private Provision of Public Goods," MPRA Paper 32045, University Library of Munich, Germany.
  9. Kräkel, Matthias, 2009. "Competitive Careers as a Way to Mediocracy," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 286, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
  10. Aisbett, Emma & McAusland, Carol, 2013. "Firm characteristics and influence on government rule-making: Theory and evidence," European Journal of Political Economy, Elsevier, vol. 29(C), pages 214-235.
  11. Toshihiro Ihori & C. Yang, 2012. "Laffer paradox, Leviathan, and political contest," Public Choice, Springer, vol. 151(1), pages 137-148, April.
  12. Angelopoulos, Konstantinos & Philippopoulos, Apostolis & Vassilatos, Vanghelis, 2009. "The social cost of rent seeking in Europe," European Journal of Political Economy, Elsevier, vol. 25(3), pages 280-299, September.
  13. Rustam Jamilov, 2013. "Optimal Resource Rent," William Davidson Institute Working Papers Series wp1046, William Davidson Institute at the University of Michigan.
  14. Van Long, Ngo, 2013. "The theory of contests: A unified model and review of the literature," European Journal of Political Economy, Elsevier, vol. 32(C), pages 161-181.
  15. Oto-Peralías, Daniel & Romero-Ávila, Diego & Usabiaga, Carlos, 2013. "Does fiscal decentralization mitigate the adverse effects of corruption on public deficits?," European Journal of Political Economy, Elsevier, vol. 32(C), pages 205-231.

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