Political Activism, Trust, and Coordination

Marco Battaglini () and Roland Benabou ()

No 3611, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We study political activism by several agents (lobbyists, unions, etc.) who have private but imperfect policy-relevant signals, and seek to influence the decisions of a policy maker. When agents can share information and coordinate their actions, the equilibrium is shown to be equivalent to that with a single lobbyist, and even though activism conveys valuable information, it always reduces social welfare. When interest groups act independently, two main scenarios arise. In a ‘bandwagon’ or low-trust equilibrium, agents have a high propensity to lobby even when it is unwarranted, and conversely the policy maker does not react unless all of them are actively lobbying. In a ‘mutual discipline’ or high-trust equilibrium, by contrast, each agent’s behaviour is more informative, and the policy maker’s response threshold correspondingly lower. The key difference is whether the event in which an agent can expect to be pivotal is one where others will be providing supporting evidence by their own activity (thus allowing him to be less truthful), or contrary evidence by their inactivity (thus forcing him to be more credible). We show that when the expected degree of conflict between the lobbyists and the policy maker is relatively high the unique equilibrium is of the ‘mutual discipline’ type; when ideological distance is relatively low, it is of the ‘bandwagon’ type; within some intermediate range, both equilibria coexist. We also examine the welfare implications of the different equilibria and study the optimal organization of influence activities, examining when the policy maker and the activists would prefer that the latter coordinate their actions, or act separately.

Keywords: activism; interest groups; lobbying; political economy; signalling games (search for similar items in EconPapers)
JEL-codes: D72 D78 D82 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mic
Date: 2002-10
View list of references

Downloads: (external link)
http://www.cepr.org/pubs/dps/DP3611.asp (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:cpr:ceprdp:3611

Ordering information: This working paper can be ordered from
http://www.cepr.org/pubs/dps/DP3611.asp

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers
Address: Centre for Economic Policy Research, 53--56 Great Sutton Street, London EC1V 0DG
Series data maintained by ().