Astroturf: Interest Group Lobbying and Corporate Strategy
Thomas Lyon () and
John Maxwell ()
No 2004-18, Working Papers from Indiana University, Kelley School of Business, Department of Business Economics and Public Policy
We study three corporate nonmarket strategies designed to influence the lobbying behavior of other special interest groups: (1) astroturf, in which the firm covertly subsidizes a group with similiar views to lobby when it normally would not; (2) the bear hug, in which the firm overtly pays a group to alter its lobbying activitives; and (3) self-regulation, in which the firm voluntarily limits the potential social harm from its activities. All three strategies reduce the informativeness of lobbying, and all reduce the payoff of the public decision-maker. We show that the decision-maker would benefit by requiring the public disclosure of funds but that the availability of alternative strategies limits the impact of such a policy.
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Published in Journal of Economics and Management Strategy, 2004
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Persistent link: https://EconPapers.repec.org/RePEc:iuk:wpaper:2004-18
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