Common Agency Lobbying over Coalitions and Policy

Common Agency Lobbying over Coalitions and Policy

By David P. Baron, Alexander Hirsch
2009Working Paper No. 2031

This paper presents a theory of common agency lobbying in which policy-interested lobbies can first influence the choice of a governing coalition and then influence the legislative bargaining over policies. Equilibria can involve active lobbying at both stages of the governing process. Contributions can also be made to defeat a policy proposal, and although those contributions are never successful they can influence coalition choice. The equilibrium policy in the legislative bargaining stage is efficient given the coalition selected, but the equilibrium coalition need not be efficient. Lobbying can also lead to the preservation of the status quo and lobby-induced gridlock. An example is presented to identify the multiplicity of equilibria and provide a full characterization of an equilibrium.

Keywords
lobbying, public policy