A History of Cronyism and Capture in the Information Technology Sector

66 Pages Posted: 2 Jul 2013 Last revised: 18 Sep 2014

Adam D. Thierer

George Mason University - Mercatus Center

Brent Skorup

George Mason University - Mercatus Center

Date Written: July 1, 2013

Abstract

This paper documents the evolution of government-granted privileges, or "cronyism," in the information and communications technology marketplace and in the media-producing sectors.

It also shows that cronyism is slowly creeping into new high-technology sectors. This influence could dull entrepreneurialism and competition in this highly innovative sector since time and resources spent on influencing politicians and capturing regulators cannot be spent competing and innovating in the marketplace.

Cronyism will also negatively impact consumer welfare by denying consumers more and better products and services. Additionally, consumers might end up paying higher prices or higher taxes due to government privileges for industry.

Finally, this paper offers strategies for stalling and diminishing the cronyism already taking root in the high-tech sector.

Keywords: cronyism, tech, high-tech, info-tech, information, technology, regulation, subsidies, transfer, market, subsidy, incentives, telecom, media, broadcasting, broadcast, cable, satellite, TV, television, rents, privilege, tax break, taxation, lobby, lobbyists, economics, competitive, anticompetitive

JEL Classification: H25, K23, L5, N4, N7, O1, O3

Suggested Citation

Thierer, Adam D. and Skorup, Brent, A History of Cronyism and Capture in the Information Technology Sector (July 1, 2013). Journal of Technology Law & Policy, Vol. 18, 2013. Available at SSRN: https://ssrn.com/abstract=2288082 or http://dx.doi.org/10.2139/ssrn.2288082

Adam D. Thierer (Contact Author)

George Mason University - Mercatus Center ( email )

3351 Fairfax Drive
4th Floor
Arlington, VA 22201-4433
United States

Brent Skorup

George Mason University - Mercatus Center ( email )

3434 Washington Boulevard
Fourth Floor
Arlington, VA 22201
United States

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