Lobbying contests with endogenous policy proposals

Johannes Münster

Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems from Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich

Abstract: Lobbyists choose what to lobby for. If they can precommit to certain policy proposals, their choice will have an influence on the behavior of opposing lobbyists. Hence lobbyists have an incentive to moderate their policy proposals in order to reduce the intensity of the lobbying contest. This logic has been explored in a number of recent papers. I reconsider the topic with a perfectly discriminating contest. With endogenous policy proposals, there is a subgame perfect equilibrium where the proposals of the lobbyists coincide and maximize joint welfare; moreover, this equilibrium is the only one that survives repeated elimination of dominated strategies. Hence there is no rent dissipation at all. A politician trying to maximize lobbying expenditures would prefer an imperfectly discriminating contest.

Keywords: Interest groups; Endogenous lobbying targets; Voluntary restraint; Polarization (search for similar items in EconPapers)
JEL-codes: D72 (search for similar items in EconPapers)
Date: 2005-05
New Economics Papers: this item is included in nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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