Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/248912 
Year of Publication: 
2021
Series/Report no.: 
CESifo Working Paper No. 9367
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
How can the West’s economic and political polarization be explained? We argue that persuasive lobbying at various levels of government leads to systematic deviations of policies from those desired by the majority. Implemented policies diverge from the majority position despite centripetal forces that induce interest groups to select positions closer to that majority position. Resources, organization, and cognitive biases can induce one-sided outcomes. When we allow for long-term lobbying infrastructure investments in a simpli_ed tax-and-spend model, the deviations between majority desires and implemented policies are even larger than those in the absence of long-term investments.
Subjects: 
interest groups
lobbying
polarization
persuasion
regulatory capture
JEL: 
D72
D73
D78
H20
Document Type: 
Working Paper
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