Common Agency Lobbying over Coalitions and Policy

Economic Theory (2012) 49:639–681

Posted: 5 Feb 2013

See all articles by David P. Baron

David P. Baron

Stanford University - Graduate School of Business

Alexander V. Hirsch

California Institute of Technology

Abstract

This paper presents a theory of common agency lobbying in which policy-interested lobbies can first influence the choice of a proto-coalition and then influence the legislative bargaining over policy within that coalition. The equilibrium policy in the legislative bargaining stage maximizes the aggregate policy utility of the coalition members and the lobbies, but lobbying can also lead to the preservation of the status quo and lobby-induced gridlock. When the status quo does not persist, the policy outcome is largely determined by the selection of a coalition, since legislative bargaining under unanimity within the coalition leads to a coalition-efficient policy regardless of the identity of the proposer. An example is presented to identify the types of equilibria and provide a full characterization of an equilibrium.

Keywords: lobbying, public policy, Proto-coalitions, common agency, gridlock

JEL Classification: D72, H11

Suggested Citation

Baron, David P. and Hirsch, Alexander V., Common Agency Lobbying over Coalitions and Policy. Economic Theory (2012) 49:639–681, Available at SSRN: https://ssrn.com/abstract=2212140

David P. Baron

Stanford University - Graduate School of Business ( email )

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Alexander V. Hirsch (Contact Author)

California Institute of Technology ( email )

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