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When Do Firms Hire Lobbyists? The Organization of Lobbying at the Federal Communications Commission

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Author Info
John M. de Figueiredo
James J. Kim
Abstract

This paper examines the explanatory power of transaction cost economics to explain vertical integration decisions for lobbying by firms. We examine 150 lobbying contacts at the Federal Communications Commission (FCC) on the issue of payphone compensation for dial-around calls. When firms lobby on topics that are highly firm-specific and prone to sensitive-information leakage, they are more likely to use employees to lobby the FCC. However, when topics arise that are more general to the industry and do not include sensitive information, firms are more likely to use outside counsel to lobby the FCC.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 10553.

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Date of creation: Jun 2004
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Handle: RePEc:nbr:nberwo:10553

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L5 - Industrial Organization - - Regulation and Industrial Policy
K0 - Law and Economics - - General

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  1. Alt, James E. & Carlsen, Fredrik & Heum, Per & Johansen, K re, 1999. "Asset Specificity and the Political Behavior of Firms: Lobbying for Subsidies in Norway," International Organization, Cambridge University Press, vol. 53(01), pages 99-116, January. [Downloadable!]
  2. Alt, James E, et al, 1999. "Asset Specificity and the Political Behavior of Firms: Lobbying for Subsidies in Norway," International Organization, MIT Press, vol. 53(1), pages 99-116, Winter.
  3. Williamson, Oliver E, 1983. "Credible Commitments: Using Hostages to Support Exchange," American Economic Review, American Economic Association, vol. 73(4), pages 519-40, September. [Downloadable!] (restricted)
  4. Klein, Benjamin & Crawford, Robert G & Alchian, Armen A, 1978. "Vertical Integration, Appropriable Rents, and the Competitive Contracting Process," Journal of Law & Economics, University of Chicago Press, vol. 21(2), pages 297-326, October.
  5. Oxley, Joanne E, 1997. "Appropriability Hazards and Governance in Strategic Alliances: A Transaction Cost Approach," Journal of Law, Economics and Organization, Oxford University Press, vol. 13(2), pages 387-409, October.
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