EconStor >
ifo Institut – Leibniz-Institut für Wirtschaftsforschung an der Universität München >
CESifo Working Papers, CESifo Group Munich >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/57959
  
Title:How a firm can induce legislators to adopt a bad policy PDF Logo
Authors:Dahm, Matthias
Dur, Robert
Glazer, Amihai
Issue Date:2012
Series/Report no.:CESifo working paper: Public Choice 3788
Abstract:This paper shows why a majority of legislators may vote for a policy that benefits a firm but harms all legislators. The firm may induce legislators to support the policy by suggesting that it is more likely to invest in a district whose voters or representative support the policy. In equilibrium, no one vote may be decisive, so each legislator who seeks the firm's investment votes for the policy, though all legislators would be better off if they all voted against the policy. Moreover, when votes reveal information about the district, the firm's implicit promise or threat can be credible. Unlike influence mechanisms based on contributions or bribes, the behavior considered is time consistent and in line with the observed small spending by special interests.
Subjects:lobbying
voting
special interests
credibility
JEL:D72
D78
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

Files in This Item:
File Description SizeFormat
715581171.pdf394.84 kBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/57959

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.