Ideological Uncertainty and Lobbying Competition

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Ideological Uncertainty and Lobbying Competition

Author Info

Martimort, David
Semenov, Aggey

Additional information is available for the following registered author(s):

Aggey P. Semenov

Abstract

Polarized interest groups (principals) compete to influence a decision-maker (agent) through monetary contributions. This decision-maker chooses a one-dimensional policy and has private information about his ideal point. Competition between interest groups under asymmetric information yields a rich pattern of equilibrium strategies and payoffs. Policies are systematically biased towards the decision-maker's ideal point and it may sometimes lead to a "laissez-faire" equilibrium. Either the most extreme decision-makers or the most moderate ones may get information rent depending on the importance of their ideological bias. The market for influence may exhibit segmentation with interest groups keeping an unchallenged influence on ideologically close-by decision-makers. Indeed, interest groups stop contributing when there is too much uncertainty on the decision-maker's ideology and when the latter is ideologically too far away.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 6992.

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Date of creation: 02 Feb 2008
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Publication status: Published in Journal of Public Economics 3-4.92(2008): pp. 456-481
Handle: RePEc:pra:mprapa:6992

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Article
- Martimort, David & Semenov, Aggey, 2008. "Ideological uncertainty and lobbying competition," Journal of Public Economics, Elsevier, vol. 92(3-4), pages 456-481, April. [Downloadable!] (restricted)

Find related papers by JEL classification:
D7 - Microeconomics - - Analysis of Collective Decision-Making
D8 - Microeconomics - - Information, Knowledge, and Uncertainty

This paper has been announced in the following NEP Reports:

NEP-ALL-2008-02-09 (All new papers)
NEP-CDM-2008-02-09 (Collective Decision-Making)
NEP-CTA-2008-02-09 (Contract Theory & Applications)
NEP-POL-2008-02-09 (Positive Political Economics)

References listed on IDEAS
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Other versions:
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