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The composition and interests of Russia's business lobbies : A test of Olson's "encompassing organization" hypothesis

Listed author(s):
  • Pyle, William
  • Solanko, Laura

Why are some lobby groups less benign in their external effects than others? Nearly three decades ago, Mancur Olson (1982) proposed that less-encompassing lobby groups with their constituents collectively representing a narrow range of sectors are more apt to seek the types of subsidies, tariffs, tax loopholes, and competition-limiting regulations that impose costs on the rest of society. To the best of our knowledge, Olson s oft-cited hypothesis has yet to be actually tested, due perhaps to the absence of adequate data on general policy preferences of various types of lobbies. Thus, we examine a pair of surveys from 2003 and 2004 which were targeted at managers of business associations (lobby groups) and their enterprise constituents to directly test Olson s hypothesis. Managers from a diverse array of Russian industrial firms and business associations were asked similar questions regarding their attitudes to policies that explicitly benefit well-defined sectoral or regional interests and, implicitly, impose external costs. The pattern of responses is striking. Managers of less-encompassing associations and the constituent firms of such groups are much more apt to see such policies in a favorable light. In contrast, more-encompassing associations and their member display greater skepticism toward narrowly targeted government interventions. Our results strongly support Olson s hypothesis.

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File URL: https://helda.helsinki.fi/bof/bitstream/123456789/8280/1/165617.pdf
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Paper provided by Bank of Finland, Institute for Economies in Transition in its series BOFIT Discussion Papers with number 5/2010.

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Date of creation: 24 Mar 2010
Publication status: Published in Published in Public Choice, April 2013, Volume 155, Issue 1-2, pp 19-41
Handle: RePEc:bof:bofitp:2010_005
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Bank of Finland, BOFIT, P.O. Box 160, FI-00101 Helsinki, Finland

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  1. Rutherford, Thomas & Tarr, David, 2006. "Regional impacts of Russia's accession to the World Trade Organization," Policy Research Working Paper Series 4015, The World Bank.
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  8. Thomas F. Rutherford & David G. Tarr, 2014. "Poverty effects of Russia's WTO accession: Modeling “real” households with endogenous productivity effects," World Scientific Book Chapters,in: APPLIED TRADE POLICY MODELING IN 16 COUNTRIES Insights and Impacts from World Bank CGE Based Projects, chapter 12, pages 287-306 World Scientific Publishing Co. Pte. Ltd..
  9. Laura Solanko, 2008. "Unequal fortunes: a note on income convergence across Russian regions," Post-Communist Economies, Taylor & Francis Journals, vol. 20(3), pages 287-301.
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  11. Evguenia Bessonova & Konstantin Kozlov & Ksenia Yudaeva, 2003. "Trade Liberalization, Foreign Direct Investment, and Productivity of Russian Firms," Working Papers w0039, Center for Economic and Financial Research (CEFIR).
  12. Dilip Mookherjee & Pranab K. Bardhan, 2000. "Capture and Governance at Local and National Levels," American Economic Review, American Economic Association, vol. 90(2), pages 135-139, May.
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  14. Gene M. Grossman & Elhanan Helpman, 1996. "Electoral Competition and Special Interest Politics," Review of Economic Studies, Oxford University Press, vol. 63(2), pages 265-286.
  15. Avdasheva, Svetlana & Golikova, Victoria & Sugiura, Fumikazu & Yakovlev, Andrei, 2007. "External Relationship of Russian Corporations," Discussion Paper Series b37, Institute of Economic Research, Hitotsubashi University.
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