Abstract
This article analyzes a simple model of policy making under uncertainty in the presence of an interest group that may fund and lobby research. In the model, if research is not disclosed via lobbying it enters the public domain and, subsequently, is randomly observed by the policy maker (PM). Consequently, the interest group strategically chooses both whether to fund research and whether to lobby it versus let it be randomly observed. The main result is that for a range of parameter values, in equilibrium the interest group sometimes funds, but never lobbies, research. This behavior effectively “jams” the public signal of the PM, making the policy choice worse on average. This occurs despite all research being unbiased. The results provide qualified theoretical support for the value of research funding transparency and implications for the interpretation of interest group funded research.
Similar content being viewed by others
References
Asami DK, Hong YJ, Barrett DM, Mitchell AE (2003) Comparison of the total phenolic and ascorbic acid content of freeze-dried and air-dried marionberry, strawberry, and corn grown using conventional, organic, and sustainable agricultural practices. J Agric Food Chem 51(5): 1237–1241
Austen-Smith D (1994) Strategic transmission of costly information. Econometrica 62: 955–963
Bennedsen M, Feldmann SE (2006) Informational lobbying and political contributions. J Public Econ 90(4-5): 631–656
Brocas I, Carrillo JD (2007) Influence through ignorance. RAND J Econ 38(4): 931–948
Cain DM, Loewenstein G, Moore DA (2005) The dirt on coming clean: perverse effects of disclosing conflicts of interest. J Legal Stud 34(1): 1–25
Cho IK, Kreps DM (1987) Signaling games and stable equilibria. Q J Econ 102(2): 179–221
Crawford V, Sobel J (1982) Strategic information transmission. Econometrica 50: 1431–1451
Dahm M, Porteiro N (2008) Informational lobbying under the shadow of political pressure. Soc Choice Welf 30(4): 531–559
Dahm M, González P, Porteiro N (2009) Trials, tricks and transparency: how disclosure rules affect clinical knowledge. J Health Econ 28(6): 1141–1153
Elliott KC (2008) Scientific judgment and the limits of conflict-of-interest policies. Account Res 15(1): 1–29
Fudenberg D, Tirole J (1986) A “signal-jamming” theory of predation. RAND J Econ 17(3): 366–376
Gelbspan R (1997) The heat is on: the high stakes over the earth’s threatened climate. Addison-Wesley, Reading, MA
Glazer J, Rubinstein A (2004) On optimal rules of persuasion. Econometrica 72(6): 1715–1736
Grossman GM, Helpman E (2001) Special interest politics. MIT Press, Cambridge
Henry E (2009) Strategic disclosure of research results: the cost of proving your honesty. Econ J 119(539): 1036–1064
Huss A, Egger M, Hug K, Huwiler-Müntener K, Röösli M (2007) Source of funding and results of studies of health effects of mobile phone use: systematic review of experimental studies. Environ Health Perspect 115(1): 1–4
Lagerlof J (1997) Lobbying, information, and private and social welfare. Eur J Political Econ 13(3): 615–637
Li M, Madarász K (2008) When mandatory disclosure hurts: expert advice and conflicting interests. J Econ Theory 139(1): 47–74
Manjoo F (2008) True enough: learning to live in a post-fact society. Wiley, New York
Milgrom P (2008) What the seller won’t tell you: persuasion and disclosure in markets. J Econ Perspect 22(1): 115–131
Milgrom P, Roberts J (1986) Relying on the information of interested parties. RAND J Econ 17(1): 18–32
Potters J, van Winden F (1992) Lobbying and asymmetric information. Public Choice 74(3): 269–292
Schlozman KL, Tierney JT (1986) Organized interests and American democracy. Harper & Row, New York
Shavell S (1994) Acquisition and disclosure of information prior to sale. RAND J Econ 25(1): 21–36
Wadman M (2010) NIH set to tighten financial rules for researchers. Nature 465: 407
Author information
Authors and Affiliations
Corresponding author
Additional information
The title of this article pays homage to Fudenberg and Tirole (1986).
Rights and permissions
About this article
Cite this article
Stone, D.F. A signal-jamming model of persuasion: interest group funded policy research. Soc Choice Welf 37, 397–424 (2011). https://doi.org/10.1007/s00355-010-0496-z
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s00355-010-0496-z