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When Do Firms Hire Lobbyists? The Organization of Lobbying at the Federal Communications Commission

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  • de Figueiredo, John
  • Kim, James

Abstract

This paper examines the explanatory power of transaction cost economics to explain vertical integration decisions for lobbying by firms. We examine 150 lobbying contacts at the Federal Communications Commission (FCC) on the issue of payphone compensation for dial-around calls. When firms lobby on topics that are highly firm-specific and prone to sensitive-information leakage, they are more likely to use employees to lobby the FCC. However, when topics arise that are more general to the industry and do not include sensitive information, firms are more likely to use outside counsel to lobby the FCC.

Suggested Citation

  • de Figueiredo, John & Kim, James, 2004. "When Do Firms Hire Lobbyists? The Organization of Lobbying at the Federal Communications Commission," Working papers 4483-04, Massachusetts Institute of Technology (MIT), Sloan School of Management.
  • Handle: RePEc:mit:sloanp:7403
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    File URL: http://hdl.handle.net/1721.1/7403
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    References listed on IDEAS

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    1. David J. TEECE, 2008. "Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy," World Scientific Book Chapters,in: The Transfer And Licensing Of Know-How And Intellectual Property Understanding the Multinational Enterprise in the Modern World, chapter 5, pages 67-87 World Scientific Publishing Co. Pte. Ltd..
    2. Oxley, Joanne E, 1997. "Appropriability Hazards and Governance in Strategic Alliances: A Transaction Cost Approach," Journal of Law, Economics, and Organization, Oxford University Press, vol. 13(2), pages 387-409, October.
    3. Klein, Benjamin & Crawford, Robert G & Alchian, Armen A, 1978. "Vertical Integration, Appropriable Rents, and the Competitive Contracting Process," Journal of Law and Economics, University of Chicago Press, vol. 21(2), pages 297-326, October.
    4. Erin Anderson, 1985. "The Salesperson as Outside Agent or Employee: A Transaction Cost Analysis," Marketing Science, INFORMS, vol. 4(3), pages 234-254.
    5. Alt, James E. & Carlsen, Fredrik & Heum, Per & Johansen, Kåre, 1999. "Asset Specificity and the Political Behavior of Firms: Lobbying for Subsidies in Norway," International Organization, Cambridge University Press, vol. 53(01), pages 99-116, December.
    6. Williamson, Oliver E, 1983. "Credible Commitments: Using Hostages to Support Exchange," American Economic Review, American Economic Association, vol. 73(4), pages 519-540, September.
    7. 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.
    8. Baron David P., 1999. "Integrated Market and Nonmarket Strategies in Client and Interest Group Politics," Business and Politics, De Gruyter, vol. 1(1), pages 7-34, December.
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    Cited by:

    1. John M. de Figueiredo & Edward H. Stiglitz, 2015. "Democratic Rulemaking," NBER Working Papers 21765, National Bureau of Economic Research, Inc.
    2. R. W. Major & Madina Rival, 2012. "From informal practices to formal conduct: Which ethical practices and issues for French lobbying consulting?," Working Papers halshs-00709380, HAL.
    3. Silke Friedrich, 2010. "Measuring Interest Group Activity," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 8(4), pages 37-46, 01.
    4. John M. de Figueiredo, 2009. "Integrated Political Strategy," NBER Working Papers 15053, National Bureau of Economic Research, Inc.
    5. repec:ces:ifodic:v:8:y:2010:i:4:p:14994986 is not listed on IDEAS

    More about this item

    Keywords

    Lobbying; Transaction Cost Economics; Appropriability; Telecommunications;

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