Externalities in the rent-seeking strategies of lobbying and bribery

Abbas Khandan ()
Additional contact information
Abbas Khandan: Department of Economics, Kharazmi University, Tehran, Iran

Public Sector Economics, 2022, vol. 46, issue 3, 421-450

Abstract: Studies investigating the relationship between lobbying and bribery are limited and contradictory. Some studies regard lobbying and bribery as substitutes while others consider them complementary strategies. Using congestion games this study attempts to clarify the externalities present in these rent-seeking strategies which generate complementarities between them. Lobbying cost-sharing and cooperation through business associations and congestion in benefits from competitive bribery are important sources of externalities. The theoretical model is then investigated empirically. The results indicate that lobbying and bribery are complementary strategies. However, as countries grow, lobbying will be used more intensely. The results also show that there is a positive externality in collective lobbying so that firms that cooperate can save on lobbying costs. There are also externalities in competitive bribery. The results show that the effects of social and legal punishments of bribery are considerable but become less severe as corruption becomes more widespread.

Keywords: lobbying; bribery; congestion games (search for similar items in EconPapers)
JEL-codes: C7 D72 D73 O57 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.pse-journal.hr/upload/files/pse/2022/3/khandan.pdf (application/pdf)

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: https://EconPapers.repec.org/RePEc:ipf:psejou:v:46:y:2022:i:3:p:421-450

DOI: 10.3326/pse.46.3.5

Access Statistics for this article

More articles in Public Sector Economics from Institute of Public Finance Contact information at EDIRC.
Bibliographic data for series maintained by Martina Fabris ().