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Collective Lobbying in Politics: Theory and Empirical Evidence from Sweden

Che-Yuan Liang ()

No 2008:2, Working Paper Series from Uppsala University, Department of Economics

Abstract: This paper first formulates a model of how the politicians in a local government collectively lobby to raise intergovernmental grants to their local government. The model identifies a relationship between council size and grants received. I then study this relationship empirically using the distribution of intergovernmental grants to the Swedish local governments. I use a fuzzy regression-discontinuity design that exploits a council size law to isolate exogenous variation in council size and find a large negative council size effect. This pattern provides indirect evidence for the occurrence of lobbying. The direction of the effect could be explained by free-riding incentives in individual lobbying effort contribution caused by a collective action problem in grant-raising among local government politicians.

Keywords: lobbying; rent-seeking; collective action problem; group size paradox; local governments; intergovernmental grants; regression-discontinuity (search for similar items in EconPapers)
JEL-codes: D72 D73 D78 H71 H72 H73 H77 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cdm, nep-pbe, nep-pol and nep-ure
Date: 2008-02-07
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