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Heterogeneous groups and rent-seeking for public goods

  • Cheikbossian, Guillaume

We present a model of endogenous public good provision and group rent-seeking influence. Specifically, two groups with different preferences over public policy and different sizes engage in rent-seeking or lobbying 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, the total level of rent-seeking activities is shown to be increasing in taste heterogeneity but decreasing in group size asymmetry.

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Article provided by Elsevier in its journal European Journal of Political Economy.

Volume (Year): 24 (2008)
Issue (Month): 1 (March)
Pages: 133-150

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Handle: RePEc:eee:poleco:v:24:y:2008:i:1:p:133-150
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505544

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  2. Katz, Eliakim & Tokatlidu, Julia, 1996. "Group competition for rents," European Journal of Political Economy, Elsevier, vol. 12(4), pages 599-607, December.
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  8. 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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  10. Pecorino, Paul, 1998. "Is There a Free-Rider Problem in Lobbying? Endogenous Tariffs, Trigger Strategies, and the Number of Firms," American Economic Review, American Economic Association, vol. 88(3), pages 652-60, June.
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  12. Dawes, Robyn M & Thaler, Richard H, 1988. "Anomalies: Cooperation," Journal of Economic Perspectives, American Economic Association, vol. 2(3), pages 187-97, Summer.
  13. Lorz, Jens Oliver, 1996. "Capital mobility, tax competition, and lobbying for redistributive capital taxation," Kiel Working Papers 779, Kiel Institute for the World Economy.
  14. Bernheim, B Douglas & Whinston, Michael D, 1986. "Common Agency," Econometrica, Econometric Society, vol. 54(4), pages 923-42, July.
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  18. Cheikbossian, G., 2004. "Lobbying and Rent-Seeking for Public Goods in a Fiscally Centralized System," Cahiers du LASER (LASER Working Papers) 2004.12, LASER (Laboratoire de Science Economique de Richter), Faculty of Economics, University of Montpellier 1.
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  20. Alesina, Alberto & La Ferrara, Eliana, 2005. "Ethnic Diversity and Economic Performance," Scholarly Articles 4553005, Harvard University Department of Economics.
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