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Political Parties and Network Formation

Topi Miettinen () and Panu Poutvaara ()

No 1918, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We argue that anti-corruption laws may provide an efficiency rationale for why political parties should meddle in the distribution of political nominations and government contracts. Anti-corruption laws forbid trade in spoils that politicians distribute. However, citizens may pay for gaining access to politicians and, thereby, to become potential candidates for nominations. Such rent-seeking results in excessive network formation. Political parties may reduce wasteful network formation, thanks to their ability to enter into exclusive membership contracts. This holds even though anti-corruption laws also bind political parties.

Keywords: political parties; two-sided platforms; rent-seeking; network formation (search for similar items in EconPapers)
JEL-codes: D72 D85 L14 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2006-01
New Economics Papers: this item is included in nep-cdm, nep-net, nep-pol and nep-soc
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