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Title: How a firm can induce legislators to adopt a bad policy
Authors: Dahm, M
Dur, R
Glazer, A
First Published: 31-Aug-2012
Publisher: Springer Nature
Citation: Public Choice, 2014, 159 (1-2), pp. 63-82
Abstract: This paper shows why a majority of legislators may vote for a policy that benefits a firm but harms all legislators. The firm may induce legislators to support the policy by suggesting that it is more likely to invest in a district where voters or their representative support the policy. In equilibrium, no one vote may be decisive, so each legislator who seeks the firm’s investment votes for the policy, though all legislators would be better off if they all voted against the policy. And when votes reveal information about the district, the firm’s implicit promise or threat can be credible. Unlike influence mechanisms based on contributions or bribes, the behavior considered is time consistent and in line with the low campaign contributions by special interests.
DOI Link: 10.1007/s11127-012-0016-z
ISSN: 0048-5829
eISSN: 1573-7101
Version: Post-print
Status: Peer-reviewed
Type: Journal Article
Rights: Copyright © 2012, Springer Science+Business Media, LLC. Deposited with reference to the publisher’s open access archiving policy. (
Appears in Collections:Published Articles, School of Management

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