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An interesting paper on informational lobbing

An interesting paper on informational lobbing – Christopher Cotton. 2012. „Pay-to-play politics: Informational lobbying and contribution limits when Money buys Access“  Journal of Public Economics Volume 96, Issues 3–4, April 2012, Pages 369–386

Christopher Cotton wrote an interesting paper on informational lobbing


Abstract

We develop a game theoretic model of informational lobbying between two interest groups and a politician, in which the politician can require political contributions in exchange for access. The analysis considers three claims: (1) the rich have better access to politicians than less-wealthy groups, (2) this access advantage makes the rich better off and skews policy in their favor, and (3) contribution limits can reduce the rich group advantage and result in less-skewed policy. We show that the rich do have better access, with the politician always offering access to the rich groups and only sometimes offering access to the less-wealthy group. This does not, however, mean that the rich group is better off or that policy is biased in its favor. The politician sets access fees to extract the greatest amount of rent from the political process. When only the rich group has access, its expected benefit from gaining access is fully offset by its payment to the politician. In this case, the less-wealthy interest group who is not targeted by the politician is better off. Contribution limits decrease the politician’s ability to extract rent, which improves the payoffs of rich interests and decreases politician payoffs. Finally, the paper presents a novel benefit of contribution limits: they can encourage the formation of lobby groups or the search for evidence, which results in more evidence disclosure and better policy.


The paper starts with smart mottos also:

 I really appreciate your additional contribution of $100,000… I hope your meeting with Trent Lott was productive.

Jim Nicholson, then Chairman of the Republican National Committee, in a letter to businessman Phil Anschutz, October 23, 1998.

Money doesn’t buy…a position. But it will definitely buy you some access so you can make your case.

Thomas Downey, former US Congressman.

Specifically, Cotton argues that he is dealing with a novel aspect that contribution limits may have a benefit which results in more disclosure and better policy.

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February 6, 2012 - Posted by | Uncategorized

1 Comment »

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