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Informational Lobbying and Pareto-Improving Agenda Constraint

Author

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  • Arnaud Dellis
  • Mandar Oak

Abstract

Interest groups (IGs) lobby policymaker (PM) by offering verifiable, policy-relevant information. The PM is limited in (1) his ability to verify the information offered by the IGs (access constraint) and (2) the number of issues he can implement reform on (agenda constraint). We show that when there exists an access constraint but no agenda constraint, the equilibrium exhibits “overlobbying,” that is, an IG with unfavorable information may lobby hoping that, the PM, unable to verify the information, may take the costly act of lobbying as a signal of favorable information and therefore implement reform on its issue. We then show that the presence of an agenda constraint can improve information transmission by curbing overlobbying. We identify circumstances under which an agenda constraint improves the ex ante expected welfare of both the PM and of each IG, thereby generating a Pareto improvement.

Suggested Citation

  • Arnaud Dellis & Mandar Oak, 2019. "Informational Lobbying and Pareto-Improving Agenda Constraint," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 35(3), pages 579-618.
    • Handle: RePEc:oup:jleorg:v:35:y:2019:i:3:p:579-618.
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    File URL: http://hdl.handle.net/10.1093/jleo/ewz002
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    Cited by:

    1. Arnaud Dellis & Mandar Oak, 2020. "Subpoena power and informational lobbying," Journal of Theoretical Politics, , vol. 32(2), pages 188-234, April.

    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
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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