Do political connections increase bank risk-taking, or do they work as a financial safety net ex post? Using a data set of lobbying activities by US financial institutions, this paper provides empirical evidence that lobbying activities reduce banks’ risks under the presence of government bailouts. First, I uncover from an event study the fact that political connections and government bailouts ...

When faced with a regulatory constraint, firms can either comply, bribe the regulator to get around the rule, or lobby the government to relax it. We analyze this choice, and its consequences, in a simple dynamic model. In equilibrium, when the level of development is low, firms are more inclined to bend the rule through bribery but they tend to switch to lobbying when the level of development ...

Yeon-Koo Che and Ian Gale (1998) [CG, hereafter] studied the impact of imposing a cap on lobbying expenditures. They showed that a cap may lead to (1) greater expected aggregate expenditure and (2) a less efficient allocation of a political prize. In their comment, Todd Kaplan and David Wettstein (2005) [KW, hereafter] show that if the cap is not rigid (i.e., its effect on the cost of lobbying ...

Objective. We examine the effects of interest community density on generalist interest organizations. A core element of population ecology theory is competitive exclusion, which suggests two hypotheses. First, through niche partitioning of the issue space among similar organizations and the comparative advantages of specialist organizations, generalists in heavily populated systems struggle to ...

We propose various models for lobbying in a probabilistic environment, in which an actor (called “The Lobby”) seeks to influence the voters’ preferences of voting for or against multiple issues when the voters’ preferences are represented in terms of probabilities. In particular, we provide two evaluation criteria and three bribery methods to formally describe these models, and we consider the ...

How does the demand for lobbying reflected by government policy activity influence the use of lobbying strategies and tactics? The authors examine this question by assessing how the complexity of the policy space affects the political action committee (PAC) system. They hypothesize that the complexity of the policy space indirectly affects the size and activity of the PAC system through its dir...

Les groupes d’intérêts peuvent fournir aux pouvoirs publics des informations précieuses sur les politiques et réglementations en place ou envisagées. L’expérience montre cependant aussi qu’en l’absence de garde-fous, activités lobbying abusives – concentration l’influence entre mains défense d'intérêts catégoriels, influence indue à travers la fourniture d'informations occultes trompe...

This article investigates the effect of lobbying on government contract allocation. I consider how affects both total spending and distribution contracts between firms. solve a novel contest model which incorporates these two effects, then structurally estimate it using panel federal contractors. The results suggest that increases by $8.837 billion (3.22%) per year. However, its effects observe...