Lobbying, Corruption and Political Influence

37 Pages Posted: 28 Dec 2006

See all articles by Nauro F. Campos

Nauro F. Campos

University College London; University of Michigan at Ann Arbor - The William Davidson Institute; IZA Institute of Labor Economics

Francesco Giovannoni

University of Bristol - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: October 2006

Abstract

Conventional wisdom suggests that lobbying is the preferred mean for exerting political influence in rich countries and corruption the preferred one in poor countries. Analyses of their joint effects are understandably rare. This paper provides a theoretical framework that focus on the relationship between lobbying and corruption (that is, it investigates under what conditions they are complements or substitutes). The paper also offers novel econometric evidence on lobbying, corruption and influence using data for about 4000 firms in 25 transition countries. Our results show that (a) lobbying and corruption are substitutes, if anything; (b) firm size, age, ownership, per capita GDP and political stability are important determinants of lobby membership; and (c) lobbying seems to be a much more effective instrument for political influence than corruption, even in poorer, less developed countries.

Keywords: Lobbying, corruption, transition, institutions

JEL Classification: D72, E23, H26, O17, P16

Suggested Citation

Campos, Nauro F. and Giovannoni, Francesco, Lobbying, Corruption and Political Influence (October 2006). CEPR Discussion Paper No. 5886, Available at SSRN: https://ssrn.com/abstract=953946

Nauro F. Campos (Contact Author)

University College London ( email )

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University of Michigan at Ann Arbor - The William Davidson Institute

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Francesco Giovannoni

University of Bristol - Department of Economics ( email )

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