Hostname: page-component-7479d7b7d-m9pkr Total loading time: 0 Render date: 2024-07-12T14:09:17.137Z Has data issue: false hasContentIssue false
  • English
  • Français

No Exaggeration: Truthfulness in the Lobbying of Government Agencies by Competing Interest Groups

Published online by Cambridge University Press:  30 October 2013

HYOUNG-GOO KANG  and
THOMAS T. HOLYOKE
HYOUNG-GOO KANG
Affiliation:
Department of Finance, Hanyang University School of Business, Seoul, Koreahyoungkang@hanyang.ac.kr
THOMAS T. HOLYOKE
Affiliation:
Department of Political Science, California State University, Fresno, Californiatholyoke@csufresno.edu
Get access Rights & Permissions [Opens in a new window]

Abstract

Intense competition can compel lobbyists to exaggerate the benefits the government would see in tax returns and social welfare if agency officials allocate such resources to the lobbyist's members. This incentive to misrepresent grows when information asymmetry exists between lobbyists and government officials. A large body of literature has investigated how interest groups compete and interact, but it disregards the interdependency of interests between competing groups and associated strategic behaviors of other players. Our signaling model of lobbying reveals ways in which agency officials can compel lobbyists for competing interests to lobby truthfully and what the policy implications of this compulsion can be. We also present case-study evidence of how this works in practice.

Type
Research Article
Information
Japanese Journal of Political Science , Volume 14 , Issue 4 , December 2013 , pp. 499 - 520
Copyright
Copyright © Cambridge University Press 2013 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Acemoglu, Daron and Robinson, James A (2001), ‘Inefficient Redistribution’, American Political Science Review, 95 (3): 649–661.CrossRefGoogle Scholar
Ainsworth, Scott H. (1993), ‘Regulating Lobbyists and Interest Group Influence’, Journal of Politics, 55 (1): 41–56.CrossRefGoogle Scholar
Ainsworth, Scott H. and Sened, Itai (1993), ‘The Role of Lobbyists: Entrepreneurs with Two Audiences’, American Journal of Political Science, 37 (3): 834–866.CrossRefGoogle Scholar
Austen-Smith, David (1993), ‘Information and Influence: Lobbying for Agendas and Votes’, American Journal of Political Science, 37 (3): 799–833.Google Scholar
Austen-Smith, David and Wright, John R. (1992), ‘Competitive Lobbying for a Legislator's Vote’, Social Choice and Welfare, 9 (1): 229–257.Google Scholar
Austen-Smith, David and Wright, John R. (1994), ‘Counteractive Lobbying’, American Journal of Political Science, 38 (1): 25–44.CrossRefGoogle Scholar
Ball, Richard (1995), ‘Interest Groups, Influence, and Welfare’, Economics and Politics, 7 (2): 119–146.CrossRefGoogle Scholar
Balla, Steven J. (1998), ‘Administrative Procedures and Political Control of the Bureaucracy’, American Political Science Review, 92 (3): 663–673.Google Scholar
Balla, Steven J. and Wright, John R. (2001), ‘Interest Groups, Advisory Committees, and Congressional Control of the Bureaucracy’, American Journal of Political Science, 45 (4): 799–812.CrossRefGoogle Scholar
Baumgartner, Frank R. and Leech, Beth L. (2001), ‘Issue Niches and Policy Bandwagons: Patterns of Interest Group Involvement in National Politics’, Journal of Politics, 63 (4): 1191 –1213.Google Scholar
Bernhagen, Patrick and Bräuninger, Thomas (2005), ‘Structural Power and Public Policy: A Signaling Model of Business Lobbying in Democratic Capitalism’, Political Studies, 53 (1): 43–64.CrossRefGoogle Scholar
Birnbaum, Jeffrey H. (1992), The Lobbyists: How Influence Peddlers Work Their Way in Washington, New York: Random House.Google Scholar
Boehmke, Frederick J., Gailmard, Sean, and Wiggs Patty, John (2005), ‘Whose Ear to Bend? Information Sources and Venue Choice in Policy Making’, Quarterly Journal of Political Science, 1 (2): 139–169.CrossRefGoogle Scholar
Brandenburger, Adam M. and Nalebuff, Barry J. (1997), Co-opetition, New York: Broadway Business.Google Scholar
Brehm, John and Gates, Scott (1997), Working, Shirking, and Sabotage: Bureaucratic Response to a Democratic Public, Ann Arbor: University of Michigan Press.Google Scholar
Browne, William P. (1990), ‘Organized Interests and Their Issue Niches: A Search for Pluralism in a Policy Domain’, Journal of Politics, 52 (2): 477–502.Google Scholar
Coates, Stephen and Morris, Stephen (1995), ‘On the Form of Transfers to Special Interests’, Journal of Political Economy, 103 (4): 1210–1235.CrossRefGoogle Scholar
Cohen, David and Richardson, Jeremy (eds.) (2009), Lobbying the European Union: Institutions, Actors, and Issues, New York: Oxford University Press.CrossRefGoogle Scholar
Crémer, Jacques and McLean, Richard P. (1985), ‘Optimal Selling Strategies Under Uncertainty for a Discriminating Monopolist when Demands are Interdependent’, Econometrica, 53 (1): 345–361.Google Scholar
Crémer, Jacques and McLean, Richard P. (1988), ‘Full Extraction of the Surplus in Bayesian and Dominant Strategy Auctions’, Econometrica, 56 (4): 1247–1257.CrossRefGoogle Scholar
Dixit, Avinash, Grossman, Gene M., and Helpman, Elhana (1997), ‘Common Agency and Coordination: General Theory and Application to Government Policy Making’, Journal of Political Economy, 105 (3): 752–769.CrossRefGoogle Scholar
Downs, Anthony (1967), Inside Bureaucracy, New York: Harper Collins.CrossRefGoogle Scholar
Echenique, Federico and Eguia, Jon X. (2007), ‘Cohesion, Insurance and Redistribution’, Quarterly Journal of Political Science, 2 (4): 287–305.CrossRefGoogle Scholar
Epstein, Gil S. and Shmuel, Nitzan (2007), Endogenous Public Policy and Contests, Springer.Google Scholar
Epstein, Gil S. and Shmuel, Nitzan (2006), ‘Lobbying and Compromise’, Public Choice, 126 (3/4): 317–330CrossRefGoogle Scholar
Fudenberg, Drew and Tirole, Jean (1991), Game Theory, Cambridge, MA: MIT Press.Google Scholar
Gray, Virginia and Lowery, David (1997), ‘Life in a Niche: Mortality Anxiety among Organized Interests in the American States’, Political Research Quarterly, 50 (1): 25–47.CrossRefGoogle Scholar
Greenwood, Justin (1997), Representing Interests in the European Union, London: Macmillan.CrossRefGoogle Scholar
Grossman, Gene M. and Helpman, Elhanan, 1996, ‘Electoral Competition and Special Interest Politics’, Review of Economic Studies, 63 (2): 265–286.CrossRefGoogle Scholar
Grossman, Gene M. and Elhanan, Helpman (1999, ‘Competing for Endorsements’, American Economic Review, 89 (3): 501–524.CrossRefGoogle Scholar
Groves, Theodore and Ledyard, John (1977), ‘Optimal Allocation of Public Goods: A Solution to the “Free Rider” Problem’, Econometrica, 45 (2): 783–810.CrossRefGoogle Scholar
Harsanyi, John C. (1967), ‘Games with Incomplete Information Played by “Bayesian” Players, I–III, Part I: The Basic Model’, Management Science, 14 (4): 159–182.CrossRefGoogle Scholar
Heaney, Michael T. (2004), ‘Outside the Issue Niche: The Multidimensionality of Interest Group Identity’, American Politics Research, 32 (4): 611–651.CrossRefGoogle Scholar
Holyoke, Thomas T. (2009), ‘Interest Group Competition and Coalition Formation’, American Journal of Political Science, 53 (1): 360–375.CrossRefGoogle Scholar
Hull, John C. (2008), Options, Futures, and Other Derivatives, New York: Prentice Hall.Google Scholar
Laffont, Jean-Jacques and Maskin, Eric (1980), ‘A Differential Approach to Dominant Strategy Mechanisms’, Econometrica, 48 (3): 1507–1520.Google Scholar
Lohmann, Susanne (1998), ‘An Information Rationale for the Power of Special Interests’, American Political Science Review, 92 (4): 809–827.CrossRefGoogle Scholar
Lux, Sean, Crook, T. Russell, and Woehr, David J. (2011), ‘Mixing Business with Politics: A Meta-Analysis of the Antecedents and Outcomes of Corporate Political Activity’, Journal of Management, 37 (1): 223–247.Google Scholar
Matsusaka, John G. (2010), ‘Popular Control of Public Policy: A Quantitative Approach’, Quarterly Journal of Political Science, 5 (2): 133–167.Google Scholar
McAfee, R. Preston, McMillan, John, and Reny, Phillip J. (1989), ‘Extracting the Surplus in the Common Value Auction’, Econometrica, 57 (4): 1451–1459.Google Scholar
Preston, McAfee, R. and Reny, Phillip J. (1992), ‘Correlated Information and Mechanism Design’, Econometrica, 60 (1): 395–421.Google Scholar
McKean, David (2004), Peddling Influence: Thomas ‘Tommy the Cork’ Corcoran and the Birth of Modern Lobbying, Hanover, NH: Steerforth Press.Google Scholar
Myerson, Roger B. (1981), ‘Optimal Auction Design’, Mathematics of Operations Research, 6 (1): 58–73.CrossRefGoogle Scholar
Petracca, Mark P. (1986), ‘Federal Advisory Committees, Interest Groups, and the Administrative State’, Congress and the Presidency, 13 (1): 83–114.CrossRefGoogle Scholar
Priest, T. B., Sylves, Richard, and Scudder, David (1984), ‘Corporate Advice: Large Corporations and Federal Advisory Committees’, Social Science Quarterly, 65 (1): 100–111.Google Scholar
Shipan, Charles R (2004), ‘Regulatory Regimes, Agency Actions, and the Conditional Nature of Congressional Influence’, American Political Science Review, 98 (3): 467–480.CrossRefGoogle Scholar
Yackee, Susan Webb (2006), ‘Sweet-Talking the Fourth Branch: The Influence of Interest Group Comments on Federal Agency Rulemaking’, Journal of Public Administration Research and Theory, 16 (1): 103–124.CrossRefGoogle Scholar
Wright, John R. (1996), Interest Groups and Congress, Boston: Allyn, BaconGoogle Scholar