Strategic analysis of influence peddling

Mukul Majumdar () and Seung Han Yoo

International Journal of Game Theory, 2012, vol. 41, issue 4, 737-762

Abstract: This paper analyzes “influence peddling” in a model that portrays interactions involving human capital transfer and collusion-building, in which each government official regulates multiple firms simultaneously. We show that there exists a collusion maximizing equilibrium between a sequence of “qualified” regulators and a firm such that the qualified bureaucrat manipulates regulation rates for two firms by regulating the colluding firm leniently for the maximized sum of their payoffs, but regulating the non-colluding firm stringently for the signaling in order to “compensate” for the lenient regulatory stance taken toward the colluding firm. Copyright Springer-Verlag 2012

Keywords: Revolving doors; Signaling games; Repeated games; D73; H83; L51 (search for similar items in EconPapers)
Date: 2012
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DOI: 10.1007/s00182-012-0340-z

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