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Communication by Interest Groups and the Organization of Lobbying

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  • Semenov, Aggey
  • Martimort, David

Abstract

This paper uses a mechanism design approach to characterize the optimal organization of lobbying groups in a political context where those groups have private information on their ideal points in a one-dimensional policy space. First, we derive the optimal mechanism for one single group and show that it depends on the confict of interests between his own preferences and those of the policy-maker but also on how informative the distribution of the interest group's ideal point is. We then extend the analysis to the case of multiple nterest groups. Although dealing with a coalition of those groups allows the policy-maker to benefit from a more precise information (an informativeness effect), the optimal organization may nevertheless call for a decentralized mechanism where groups compete because this is the only way to transmit information on the relative strength of their preferences (a screening effect). A coalition of interest groups dominates for small values of the confict of interests whereas competing interest groups emerge for greater values.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 8519.

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Date of creation: 01 Jul 2004
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Handle: RePEc:pra:mprapa:8519

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  1. Vijay Krishna & John Morgan, 1999. "A Model of Expertise," Game Theory and Information 9902003, EconWPA.
    • Vijay Krishna & John Morgan, 1999. "A Model of Expertise," Working Papers 154, Princeton University, Woodrow Wilson School of Public and International Affairs, Discussion Papers in Economics..
    • Krishna, V. & Morgan, J., 1999. "A Model of Expertise," Papers 206, Princeton, Woodrow Wilson School - Public and International Affairs.
  2. Marco Battaglini, 2000. "Multiple Referrals and Multidimensional Cheap Talk," Econometric Society World Congress 2000 Contributed Papers 1557, Econometric Society.
  3. Gromb, Denis & Martimort, David, 2004. "The Organization of Delegated Expertise," CEPR Discussion Papers 4572, C.E.P.R. Discussion Papers.
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  7. Baron, David P. & Meirowitz, Adam, 2001. "Relations between Fully-Revealing Equilibria of Multiple-Sender Signaling and Screening Models," Research Papers 1711, Stanford University, Graduate School of Business.
  8. Dana Jr. James D., 1993. "The Organization and Scope of Agents: Regulating Multiproduct Industries," Journal of Economic Theory, Elsevier, vol. 59(2), pages 288-310, April.
  9. V. Crawford & J. Sobel, 2010. "Strategic Information Transmission," Levine's Working Paper Archive 544, David K. Levine.
  10. Marco Battaglini & Roland Bénabou, 2003. "Trust, Coordination, and the Industrial Organization of Political Activism," Journal of the European Economic Association, MIT Press, vol. 1(4), pages 851-889, 06.
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  13. Mookherjee, Dilip & Reichelstein, Stefan, 1992. "Dominant strategy implementation of Bayesian incentive compatible allocation rules," Journal of Economic Theory, Elsevier, vol. 56(2), pages 378-399, April.
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