Abstract
We examine the incentives of an interest group to provide verifiable policy-relevant information to a political decision-maker and to exert political pressure on her. In our view information provision is a risky attempt to affect the politician’s beliefs about the desirability of the lobby’s objective. The circumstances under which political pressure can be applied specify the lobby’s valuation of different beliefs of the politician and, thus, her attitude toward risk. We identify several factors that induce risk proclivity (and thus information provision), which allows to explain the stylized fact that lobbies engage both in information provision and political pressure. Moreover, our approach gives a novel explanation for the fact that interest groups often try to provide information credibly. We finally study the extent to which this preference for credibility is robust and identify some instances in which lobbies may prefer to strategically withhold information.
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We wish to thank David Austen-Smith, Steven Callander, Daniel Diermeier, Sven Feldmann, Paula González, Jean Hindriks, Johannes Hörner, Rafael Hortala-Vallve, Jaehoon Kim, Christoph Kuzmics, Inés Macho-Stadler, Antonio Nicolo, Ignacio Ortuño-Ortín, David Pérez-Castrillo, Anaís Tarragó, Fernando Vega-Redondo and Michael Wallerstein for helpful comments. The comments of an anonymous referee substantially improved the manuscript. The usual disclaimer applies. This work has been partially carried out while the first author was visiting Northwestern University (Kellogg School of Management, MEDS, CMS-EMS). The hospitality of this institution and the financial support of the Spanish Secretaría de Estado de Educación y Universidades with co-funding by the European Social Fond is gratefully acknowledged. This work is also partially supported by the Departament d’Universitats, Recerca i Societat de la Informació (Generalitat de Catalunya), project 2005SGR00949.
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Dahm, M., Porteiro, N. Informational lobbying under the shadow of political pressure. Soc Choice Welfare 30, 531–559 (2008). https://doi.org/10.1007/s00355-007-0264-x
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DOI: https://doi.org/10.1007/s00355-007-0264-x