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Electoral Competition and Special Interest Politics

  • Gene Grossman
  • Elhanan Helpman

We study the competition between two political parties for seats in a parliament. The parliament will set two types of policies: ideological and non-ideological. The parties have fixed positions on the ideological issues, but choose their non-ideological platforms to attract voters and campaign contributions. In this context, we ask: How do the equilibrium contributions from special interest groups influence the platforms of the parties? We show that each party is induced to behave as if it were maximizing a weighted sum of the aggregate welfares of informed voters and members of special interest groups. The party that is expected to win a majority of seats caters more to the special interests.

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File URL: http://www.nber.org/papers/w4877.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 4877.

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Date of creation: Oct 1994
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Publication status: published as Review of Economic Studies, (April 1996) vol. 63,no.2, pp. 265-286.
Handle: RePEc:nbr:nberwo:4877
Note: ITI
Contact details of provider: Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
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Web page: http://www.nber.org
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  1. Grossman, Gene M & Shapiro, Carl, 1984. "Informative Advertising with Differentiated Products," Review of Economic Studies, Wiley Blackwell, vol. 51(1), pages 63-81, January.
  2. Assar Lindbeck & J├Ârgen Weibull, 1987. "Balanced-budget redistribution as the outcome of political competition," Public Choice, Springer, vol. 52(3), pages 273-297, January.
  3. Denzau, Arthur T & Kats, Amoz, 1977. "Expected Plurality Voting Equilibrium and Social Choice Functions," Review of Economic Studies, Wiley Blackwell, vol. 44(2), pages 277-33, June.
  4. Grossman, G.M. & Helpman, E., 1992. "Protection for Sale," Papers 162, Princeton, Woodrow Wilson School - Public and International Affairs.
  5. Snyder, James M, 1989. "Election Goals and the Allocation of Campaign Resources," Econometrica, Econometric Society, vol. 57(3), pages 637-60, May.
  6. Coughlin, Peter & Nitzan, Shmuel, 1981. "Electoral outcomes with probabilistic voting and Nash social welfare maxima," Journal of Public Economics, Elsevier, vol. 15(1), pages 113-121, February.
  7. Peter Coughlin, 1986. "Elections and income redistribution," Public Choice, Springer, vol. 50(1), pages 27-91, January.
  8. David Austen-Smith, 1987. "Interest groups, campaign contributions, and probabilistic voting," Public Choice, Springer, vol. 54(2), pages 123-139, January.
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