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The Rise of NGO Activism

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  • Julien Daubanes
  • Jean-Charles Rochet

Abstract

Activist NGOs increasingly oppose industrial projects that have nevertheless been approved by public regulators. To understand this recent rise in NGO activism, we develop a theory of optimal regulation in which a regulated industry seeks to undertake a project that may be harmful to society. On the one hand, public regulation is vulnerable to the influence of the industry, and may approve the project even though it is harmful. On the other hand, an NGO may oppose the project. We characterize the circumstances under which NGO opposition occurs and the circumstances under which this opposition is socially beneficial. The theory is used to explain the role that NGOs have assumed in the last decades, and has implications for the legal status of NGO activism and the appropriate degree of transparency.

Suggested Citation

  • Julien Daubanes & Jean-Charles Rochet, 2016. "The Rise of NGO Activism," CESifo Working Paper Series 5891, CESifo.
  • Handle: RePEc:ces:ceswps:_5891
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    2. Ambec, Stefan & De Donder, Philippe, 2022. "Environmental policy with green consumerism," Journal of Environmental Economics and Management, Elsevier, vol. 111(C).
    3. Nicolas Treich, 2018. "Veganomics : vers une approche économique du véganisme ?," Revue française d'économie, Presses de Sciences-Po, vol. 0(4), pages 3-48.
    4. Meisinger, Norman, 2022. "A tragedy of intangible commons: Riding the socioecological wave," Ecological Economics, Elsevier, vol. 193(C).
    5. Espinosa, Romain & Treich, Nicolas, 2020. "Moderate vs. Radical NGOs," TSE Working Papers 20-1159, Toulouse School of Economics (TSE).
    6. Fabien Prieur & Benteng Zou, 2017. "On the impact of indirect competition for political influence on environmental policy," DEM Discussion Paper Series 17-16, Department of Economics at the University of Luxembourg.
    7. Pamina Koenig & Sandra Poncet, 2019. "Reputation and (un)fair trade: Effects on French importers from the Rana Plaza collapse," Post-Print halshs-02350112, HAL.
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    9. Daniel Cardona & Jenny De Freitas & Antoni Rubí-Barceló, 2021. "Environmental policy contests: command and control versus taxes," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 28(3), pages 654-684, June.

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    More about this item

    Keywords

    NGO activism; public regulation; industry lobbying; private politics; transparency;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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