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The political roots of intermediated lobbying: evidence from Russian firms and business associations

Author

Listed:
  • Andrei Govorun

    () (National Research University Higher School of Economics)

  • Israel Marques

    () (National Research University Higher School of Economics)

  • William Pyle

    () (Economics Department, Middlebury College)

Abstract

How does political competition shape the way that firms pursue legislative change? A rich political economy literature describes various ways in which firms influence the design and enforcement of laws, rules and regulations germane to their business activities. Although helpful, this literature is disconnected from work on legislative accountability and political concentration. Making a distinction poorly developed in prior research, we contrast firms that choose to influence policy directly, through un-mediated contacts with executive and legislative branch personnel, and those that do so indirectly, through lobby groups acting as intermediaries. We propose a simple theory that relates the relative costs of lobbying and the strategies firms select to the extent of political competition and concentration. As competition increases and concentration decreases in a region, the use of indirect channels of lobbying becomes more attractive (and vice versa). We test our theory using a survey of 1013 firms across 61 Russian regions. Exploiting substantial variation in political competition and concentration across Russia’s regions, we find that firms in politically competitive environments, where there is less concentration, are more likely to use business associations to influence their institutional environment. Using a survey of 315 business associations, we show that these effects may be explained by the variation of the willingness of regional decision-making officials to support more or less encompassing policies depending on local political environment

Suggested Citation

  • Andrei Govorun & Israel Marques & William Pyle, 2013. "The political roots of intermediated lobbying: evidence from Russian firms and business associations," HSE Working papers WP BRP 46/EC/2013, National Research University Higher School of Economics.
  • Handle: RePEc:hig:wpaper:46/ec/2013
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    References listed on IDEAS

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    Cited by:

    1. Sokolov, Vladimir & Solanko, Laura, 2016. "Political influence, firm performance and survival," BOFIT Discussion Papers 20/2016, Bank of Finland, Institute for Economies in Transition.
    2. Michael Rochlitz, 2016. "Collective Action Abroad: How Foreign Investors Organize Evidence from Foreign Business Associations In the Russian Federation," HSE Working papers WP BRP 32/PS/2016, National Research University Higher School of Economics.

    More about this item

    Keywords

    lobbying; democratic institutions; business associations; Russia;

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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