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Lobbying, Corruption and Political Influence

  • Campos, Nauro F

    ()

    (Brunel University)

  • Giovannoni, Francesco

    ()

    (University of Bristol)

Conventional wisdom suggests that lobbying is the preferred mean for exerting political influence in rich countries and corruption the preferred one in poor countries. Analyses of their joint effects are understandably rare. This paper provides a theoretical framework that focus on the relationship between lobbying and corruption (that is, it investigates under what conditions they are complements or substitutes). The paper also offers novel econometric evidence on lobbying, corruption and influence using data for about 4000 firms in 25 transition countries. Our results show that (a) lobbying and corruption are substitutes, if anything; (b) firm size, age, ownership, per capita GDP and political stability are important determinants of lobby membership; and (c) lobbying seems to be a much more effective instrument for political influence than corruption, even in poorer, less developed countries.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2313.

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Length: 37 pages
Date of creation: Sep 2006
Date of revision:
Publication status: published in: Public Choice, 2007, 131 (1), 1-21
Handle: RePEc:iza:izadps:dp2313
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