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Congressional Committees as Reputation-building Mechanisms


  • Kroszner Randall S.

    (University of Chicago & George Mason University)

  • Stratmann Thomas S.

    (University of Chicago & George Mason University)


Interest groups cannot enforce contracts with legislators to work in their favor since fee-for-service agreements would be considered bribery. When such contracts are not available, a system of specialized, standing committees can provide a second-best way to maximize contributions, since such a system facilitates repeated interactions and reputational development between PACs and members of the relevant committees. Using data on PAC contributions by competing financial services interests to members of the House Banking Committee, we find evidence consistent with key implications of our model of committees as reputational-development devises. We then interpret important episodes in the evolution and development of the committee system during the twentieth century from the perspective of our theory. We focus on the revolt against House Speaker Cannon, which resulted in the birth of the modern committee system, and the post-Watergate reforms. We also consider broader implications of this approach for analyzing term limits, corruption, and party strength. JEL classifications: D72, D78, G28.

Suggested Citation

  • Kroszner Randall S. & Stratmann Thomas S., 2000. "Congressional Committees as Reputation-building Mechanisms," Business and Politics, De Gruyter, vol. 2(1), pages 1-19, April.
  • Handle: RePEc:bpj:buspol:v:2:y:2000:i:1:n:3

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    Cited by:

    1. repec:bla:pbudge:v:37:y:2017:i:3:p:47-70 is not listed on IDEAS
    2. Ansolabehere, Stephen & De Figueiredo, John M. & Snyder, James M., 2003. "Are Campaign Contributions Investment in the Political Marketplace or Individual Consumption? Or "Why Is There So Little Money in Politics?"," Working papers 4272-02, Massachusetts Institute of Technology (MIT), Sloan School of Management.
    3. repec:bla:kyklos:v:70:y:2017:i:2:p:220-255 is not listed on IDEAS
    4. Tahoun, Ahmed, 2014. "The role of stock ownership by US members of Congress on the market for political favors," Journal of Financial Economics, Elsevier, vol. 111(1), pages 86-110.
    5. Thomas Stratmann, 2005. "Some talk: Money in politics. A (partial) review of the literature," Public Choice, Springer, vol. 124(1), pages 135-156, July.
    6. Kroszner, Randall S & Stratmann, Thomas, 2005. "Corporate Campaign Contributions, Repeat Giving, and the Rewards to Legislator Reputation," Journal of Law and Economics, University of Chicago Press, vol. 48(1), pages 41-71, April.
    7. William Duncombe & Yilin Hou, 2014. "The Savings Behavior of Special Purpose Governments: A Panel Study of New York School Districts," Public Budgeting & Finance, Wiley Blackwell, vol. 34(3), pages 1-23, September.
    8. John M. de Figueiredo, 2011. "Committee Jurisdiction, Congressional Behavior and Policy Outcomes," NBER Working Papers 17171, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation


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