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The Allocation of Resources by Interest Groups: Lobbying, Litigation and Administrative Regulation

Author

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  • De Figueiredo, John M.
  • De Figueiredo, Rui J. P. Jr.

Abstract

One of the central concerns about American policy-making institutions is the degree to which political outcomes can be influenced by interested parties. While the literature on interest group strategies in particular institutions - legislative, administrative, and legal - is extensive, there is very little scholarship which examines how the interdependencies between institutions affects the strategies of groups. In this paper we examine in a formal theoretical model, how the opportunity to litigate administrative rulemaking in the courts affects the lobbying strategies of competing interest groups at the rulemaking stage. Using a resource-based view of group activity, we develop a number of important insights about each stage - which cannot be observed by examining each one in isolation. We demonstrate that lobbying effort responds to the ideology of the court, and the responsiveness of the court to resources. In particular, 1) as courts become more biased toward the status quo, interest group lobbying investments become smaller, and may be eliminated all together, 2) as interest groups become wealthier, they spend more on lobbying, and 3) as the responsiveness of courts to resources decreases, the effect it has on lobbying investments depends on the underlying ideology of the court.

Suggested Citation

  • De Figueiredo, John M. & De Figueiredo, Rui J. P. Jr., 2002. "The Allocation of Resources by Interest Groups: Lobbying, Litigation and Administrative Regulation," Working papers 4247-02, Massachusetts Institute of Technology (MIT), Sloan School of Management.
  • Handle: RePEc:mit:sloanp:715
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    File URL: http://hdl.handle.net/1721.1/715
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    References listed on IDEAS

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    1. Tiller, Emerson H, 1998. "Controlling Policy by Controlling Process: Judicial Influence on Regulatory Decision Making," Journal of Law, Economics, and Organization, Oxford University Press, vol. 14(1), pages 114-135, April.
    2. De Figueiredo, John M. & De Figueiredo, Rui J. P. Jr., 2002. "Managerial Decision-Making in Non-Market Environments: A Survey Experiment," Working papers 4246-02, Massachusetts Institute of Technology (MIT), Sloan School of Management.
    3. Groseclose, Tim, 1996. "An Examination of the Market for Favors and Votes in Congress," Economic Inquiry, Western Economic Association International, vol. 34(2), pages 320-340, April.
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    5. Rubin, Paul H & Curran, Christopher & Curran, John F, 2001. "Litigation versus Legislation: Forum Shopping by Rent Seekers," Public Choice, Springer, vol. 107(3-4), pages 295-310, June.
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    8. Snyder, James M, Jr, 1992. "Long-Term Investing in Politicians; or, Give Early, Give Often," Journal of Law and Economics, University of Chicago Press, vol. 35(1), pages 15-43, April.
    9. Stratmann, Thomas, 1998. "The Market for Congressional Votes: Is Timing of Contributions Everything?," Journal of Law and Economics, University of Chicago Press, vol. 41(1), pages 85-113, April.
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    13. Spiller, Pablo T & Spitzer, Matthew L, 1992. "Judicial Choice of Legal Doctrines," Journal of Law, Economics, and Organization, Oxford University Press, vol. 8(1), pages 8-46, March.
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    15. Baron, David P., 1999. "Integrated Market and Nonmarket Strategies in Client and Interest Group Politics," Business and Politics, Cambridge University Press, vol. 1(01), pages 7-34, April.
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    Citations

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    Cited by:

    1. Brousseau, Eric & Garrouste, Pierre & Raynaud, Emmanuel, 2011. "Institutional changes: Alternative theories and consequences for institutional design," Journal of Economic Behavior & Organization, Elsevier, vol. 79(1-2), pages 3-19, June.
    2. Marco Sorge, 2015. "Lobbying (strategically appointed) bureaucrats," Constitutional Political Economy, Springer, vol. 26(2), pages 171-189, June.
    3. John M. de Figueiredo, 2009. "Integrated Political Strategy," NBER Working Papers 15053, National Bureau of Economic Research, Inc.
    4. Mariano Tommasi & Matias Iaryczower & Pablo T. Spiller, 2004. "Judicial Lobbying: The Politics of Labor Law, Constitutional Interpretation. Argentina 1935-1998," Working Papers 73, Universidad de San Andres, Departamento de Economia, revised Jun 2004.

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