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Lobbying Activities of Multinational Firms

Author

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  • Andreas Polk

Abstract

This paper investigates if multinationals in.uence the political process through lobbying more effectively than national firms. First, I introduce a model which contrasts a multinational�s incentives for lobbying with those of a national firm. Then the effect of lobbying on the political decision is analyzed. I conclude that multinationals have smaller incentives to lobby because they have smaller stakes in national markets. But the effectiveness of lobbying by multinationals might be higher if the government cares much about production in the home country. The resulting regulation depends on the relative strength of these effects.

Suggested Citation

  • Andreas Polk, 2002. "Lobbying Activities of Multinational Firms," SOI - Working Papers 0205, Socioeconomic Institute - University of Zurich, revised Jun 2002.
  • Handle: RePEc:soz:wpaper:0205
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    File URL: http://www.econ.uzh.ch/static/wp_soi/wp0205.pdf
    File Function: Revised version, 2002
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    References listed on IDEAS

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    6. Olarreaga, Marcelo, 1999. "Foreign-owned Capital and Endogenous Tariffs," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 14, pages 606-624.
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    11. Hillman, Arye L & Ursprung, Heinrich W, 1993. "Multinational Firms, Political Competition, and International Trade Policy," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 34(2), pages 347-363, May.
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    Citations

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    Cited by:

    1. Holtbrügge, Dirk & Berg, Nicola & Puck, Jonas F., 2007. "To bribe or to convince? Political stakeholders and political activities in German multinational corporations," International Business Review, Elsevier, vol. 16(1), pages 47-67, February.
    2. Heidenreich, Stefan & Mohr, Alexander & Puck, Jonas, 2015. "Political strategies, entrepreneurial overconfidence and foreign direct investment in developing countries," Journal of World Business, Elsevier, vol. 50(4), pages 793-803.
    3. Kokko, Ari, 2006. "The Home Country Effects Of Fdi In Developed Economies," EIJS Working Paper Series 225, Stockholm School of Economics, The European Institute of Japanese Studies.
    4. Rodolphe Desbordes & Julien Vauday, 2007. "The Political Influence Of Foreign Firms In Developing Countries," Economics and Politics, Wiley Blackwell, vol. 19(3), pages 421-451, November.

    More about this item

    Keywords

    multinational enterprizes; regulation; policy formation; lobbying; interest groups; foreign direct investment.;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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