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Political Parties and Rent-seeking through Networks


  • Topi Miettinen


  • Panu Poutvaara


Anti-corruption laws forbid selling nominations to public jobs. 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 argue 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

  • Topi Miettinen & Panu Poutvaara, 2007. "Political Parties and Rent-seeking through Networks," Papers on Strategic Interaction 2006-28, Max Planck Institute of Economics, Strategic Interaction Group.
  • Handle: RePEc:esi:discus:2006-28

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    References listed on IDEAS

    1. Helpman Elhanan & Persson Torsten, 2001. "Lobbying and Legislative Bargaining," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 1(1), pages 1-33, November.
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    More about this item


    Political parties; Political Nominations; Rent-seeking; Connections; Networks; Two-sided Platforms;

    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
    • H8 - Public Economics - - Miscellaneous Issues
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation

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