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Parties as efficiency-improving gatekeepers in rent-seeking societies

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  • Miettinen, Topi
  • Poutvaara, Panu

Abstract

Anti-corruption laws forbid selling public job nominations. Even if bribing is ruled out, those interested in the nominations may invest in good relationships with the nominators. This provides a legal way to influence the decision. Such networking is costly, however. Thus, rent-seeking results in excessive networking. We present a simple model featuring such effects and show that efficiency may be improved if political parties interfere with the nominations. Political parties may reduce wasteful networking, thanks to exclusive membership contracts. Parties can require that politicians belonging to the party promote the nomination of other party members, thus, reducing incentives to cultivate inter-party connections.

Suggested Citation

  • Miettinen, Topi & Poutvaara, Panu, 2015. "Parties as efficiency-improving gatekeepers in rent-seeking societies," European Journal of Political Economy, Elsevier, vol. 38(C), pages 87-101.
    • Handle: RePEc:eee:poleco:v:38:y:2015:i:c:p:87-101
    DOI: 10.1016/j.ejpoleco.2015.01.003
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    References listed on IDEAS

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    Cited by:

    1. Commander, Simon & Poupakis, Stavros, 2020. "Political Networks across the Globe," IZA Discussion Papers 13103, IZA Network @ LISER.
    2. Panu Poutvaara, 2015. "The Role of Political Parties in Rent-Seeking Societies," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 13(03), pages 23-26, October.
    3. repec:ces:ifodic:v:13:y:2015:i:3:p:19172603 is not listed on IDEAS
    4. Miroslav Palanský, 2021. "The value of political connections in the post-transition period: evidence from Czechia," Public Choice, Springer, vol. 188(1), pages 121-154, July.
    5. Panu Poutvaara, 2015. "The Role of Political Parties in Rent-Seeking Societies," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 13(3), pages 23-26, October.
    6. Tian Lan & Ying-yi Hong, 2017. "Norm, gender, and bribe-giving: Insights from a behavioral game," PLOS ONE, Public Library of Science, vol. 12(12), pages 1-21, December.
    7. Jacques Simon Song, 2021. "Le rôle des clivages des partis politiques dans le renforcement de la démocratie en Afrique," African Development Review, African Development Bank, vol. 33(1), pages 91-103, March.

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    Keywords

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    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation

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