IDEAS home Printed from https://ideas.repec.org/p/ces/ceswps/_787.html

Entry Regulation and the Influence of an Incumbent Special Interest Group

Author

Listed:
  • John Evans
  • John Fingleton

Abstract

The literature on both entry deterrence and the influence of special interest groups is extensive. In this paper we attempt to marry these strands of literature by developing a model of entry deterrence through interest group influence in an entry re-regulation context. In contrast to other entry deterrence models, we are able to investigate how product market rivalry affects the regulator's equilibrium entry decision, firms' output decisions, entry deterring activities and equilibrium welfare. We find that in equilibrium more collusive industries tend to lobby more but that the regulator attempts to compensate for weak price rivalry by allowing greater entry. The latter effect tends to offset the former, possibly entirely so that the overall welfare effect is ambiguous.

Suggested Citation

  • John Evans & John Fingleton, 2002. "Entry Regulation and the Influence of an Incumbent Special Interest Group," CESifo Working Paper Series 787, CESifo.
    • Handle: RePEc:ces:ceswps:_787
    as

    Download full text from publisher

    File URL: https://www.ifo.de/DocDL/cesifo_wp787.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. McCormick, Robert E & Shughart, William F, II & Tollison, Robert D, 1984. "The Disinterest in Deregulation," American Economic Review, American Economic Association, vol. 74(5), pages 1075-1079, December.
    2. N. Gregory Mankiw & Michael D. Whinston, 1986. "Free Entry and Social Inefficiency," RAND Journal of Economics, The RAND Corporation, vol. 17(1), pages 48-58, Spring.
    3. Timothy Besley & Stephen Coate, 2003. "Elected Versus Appointed Regulators: Theory and Evidence," Journal of the European Economic Association, MIT Press, vol. 1(5), pages 1176-1206, September.
    4. Seade, Jesus K, 1980. "On the Effects of Entry," Econometrica, Econometric Society, vol. 48(2), pages 479-489, March.
    5. Laffont, Jean-Jacques, 1996. "Industrial policy and politics," International Journal of Industrial Organization, Elsevier, vol. 14(1), pages 1-27.
    6. Gary S. Becker, 1983. "A Theory of Competition Among Pressure Groups for Political Influence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(3), pages 371-400.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Klapper, Leora & Laeven, Luc & Rajan, Raghuram, 2006. "Entry regulation as a barrier to entrepreneurship," Journal of Financial Economics, Elsevier, vol. 82(3), pages 591-629, December.
    2. Rajan, Raghuram & Laeven, Luc & Klapper, Leora F., 2004. "Business Environment and Firm Entry: Evidence from International Data," CEPR Discussion Papers 4366, C.E.P.R. Discussion Papers.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Juin-Jen Chang & Ching-Chong Lai & Ping Wang, 2010. "Casino regulations and economic welfare," Canadian Journal of Economics, Canadian Economics Association, vol. 43(3), pages 1058-1085, August.
    2. Juin-Jen Chang & Ching-Chong Lai & Ping Wang, 2004. "On the Public Economics of Casino Gambling," IEAS Working Paper : academic research 04-A005, Institute of Economics, Academia Sinica, Taipei, Taiwan.
    3. Rodrigo M. S. Moita & Claudio Paiva, 2013. "Political Price Cycles in Regulated Industries: Theory and Evidence," American Economic Journal: Economic Policy, American Economic Association, vol. 5(1), pages 94-121, February.
    4. Kurata, Hiroshi & Ohkawa, Takao & Okamura, Makoto, 2009. "Location choice, competition, and welfare in non-tradable service FDI," International Review of Economics & Finance, Elsevier, vol. 18(1), pages 20-25, January.
    5. Yogesh Uppal, 2011. "Does legislative turnover adversely affect state expenditure policy? Evidence from Indian state elections," Public Choice, Springer, vol. 147(1), pages 189-207, April.
    6. Boggio, Margherita, 2011. "Municipal capitalism, regulatory federalism and politics," MPRA Paper 46244, University Library of Munich, Germany.
    7. Krishnendu Ghosh Dastidar & Sugata Marjit, 2022. "Market size, entry costs and free entry Cournot equilibrium," Journal of Economics, Springer, vol. 136(2), pages 97-114, July.
    8. Richard Higgins & Arijit Mukherjee, 2010. "Deregulation redux: does mandating access to bottleneck facilities necessarily improve welfare?," Public Choice, Springer, vol. 142(3), pages 363-377, March.
    9. Luca Colombo & Paola Labrecciosa & Patrick Paul Walsh, 2005. "Optimal Corporation Tax: An I.O. Approach," The Institute for International Integration Studies Discussion Paper Series iiisdp97, IIIS.
    10. de Pinto Marco & Goerke Laszlo, 2019. "Efficiency Wages in Cournot-Oligopoly," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 19(4), pages 1-13, October.
    11. Shoji Haruna & Rajeev Goel, 2011. "R&D, free entry, and social inefficiency," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 20(1), pages 89-101.
    12. Marco de Pinto & Laszlo Goerke & Alberto Palermo, 2024. "Informational rents and the excessive entry theorem: The case of hidden action," Scottish Journal of Political Economy, Scottish Economic Society, vol. 71(2), pages 237-252, May.
    13. Holloway, Garth J., 1992. "The Representative Firm, Endogenous Output Decisions And Consistent Conjectural Variations In Oligopoly," Working Papers 225876, University of California, Davis, Department of Agricultural and Resource Economics.
    14. Brian C. Albrecht & Joshua R. Hendrickson & Alexander William Salter, 2022. "Evolution, uncertainty, and the asymptotic efficiency of policy," Public Choice, Springer, vol. 192(1), pages 169-188, July.
    15. J. Luis Guasch & Jean-Jacques Laffont & Stéphane Straub, 2007. "Concessions of infrastructure in Latin America: Government-led renegotiation," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(7), pages 1267-1294.
    16. Dino Falaschetti, 2003. "Voter Turnout, Regulatory Commitment, and Capital Accumulation: Evidence from the US Telecommunications Sector," Microeconomics 0311002, University Library of Munich, Germany.
    17. Tomaso Duso, 2005. "Lobbying and regulation in a political economy: Evidence from the U.S. cellular industry," Public Choice, Springer, vol. 122(3), pages 251-276, March.
    18. Hamilton, Stephen F. & Sunding, David L., 2000. "Product liability, entry incentives and market structure," International Review of Law and Economics, Elsevier, vol. 20(2), pages 269-283, June.
    19. Evgeny Lyandres & Fangjian Fu & Erica X. N. Li, 2018. "Do Underwriters Compete in IPO Pricing?," Management Science, INFORMS, vol. 64(2), pages 925-954, February.
    20. David, Maia & Nimubona, Alain-Désiré & Sinclair-Desgagné, Bernard, 2011. "Emission taxes and the market for abatement goods and services," Resource and Energy Economics, Elsevier, vol. 33(1), pages 179-191, January.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_787. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Klaus Wohlrabe (email available below). General contact details of provider: https://edirc.repec.org/data/cesifde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.