Collective vs. Individual Lobbying
Norimichi Matsueda
No 175, Discussion Paper Series from School of Economics, Kwansei Gakuin University
Abstract:
In this paper, we compare the political equilibrium outcomes under two distinct institutional setups concerning the regulated firms' lobbying environment: collective and individual lobbying. Under both regimes, each firm voluntarily chooses whether or not to participate in lobbying activities to influence an environmental regulation with which all the firms need to comply eventually. While, under collective lobbying, firms form a single group before conducting lobbying activities, there is no such pre-coordination under individual lobbying and firms can lobby independently if they wish. The difference in the equilibrium outcomes is quite striking: whereas only a small fraction of firms join the industrial lobbying group under collective lobbying, all the firms participate in lobbying activities in the case of individual lobbying. We also evaluate the desirability of the two lobbying regimes from the perspectives of both individual firms and the society as a whole, and discuss the implications for possible institutional interventions.
Keywords: common agency; compensating equilibrium; environmental regulation; free-rider; lobbying (search for similar items in EconPapers)
JEL-codes: D72 H41 Q58 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2018-02, Revised 2018-02
New Economics Papers: this item is included in nep-cdm and nep-pol
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http://192.218.163.163/RePEc/pdf/kgdp175.pdf First version, 2018 (application/pdf)
Related works:
Journal Article: Collective vs. individual lobbying (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:kgu:wpaper:175
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