Corporate Influence and the Regulatory Mandate

Authors

  • Sanford C. Gordon,

    Corresponding author
    1. New York University
      Sanford Clark Gordon is assistant professor of politics, New York University, New York, NY 10003. Catherine Hafer is assistant professor of politics, New York University, New York, NY 10003.
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  • Catherine Hafer

    Corresponding author
    1. New York University
      Sanford Clark Gordon is assistant professor of politics, New York University, New York, NY 10003. Catherine Hafer is assistant professor of politics, New York University, New York, NY 10003.
    Search for more papers by this author

Sanford Clark Gordon is assistant professor of politics, New York University, New York, NY 10003. Catherine Hafer is assistant professor of politics, New York University, New York, NY 10003.

Abstract

Industries face collective action and commitment problems when attempting to influence Congress. At the same time, an individual firm's political investments can yield reduced bureaucratic scrutiny by indicating that firm's willingness to contest agency decisions. We develop a model in which the desirability of maintaining a political footprint for this reason enables individual firms to commit to rewarding elected officials who maintain laws benefiting an entire industry. Our “dual forbearance” model anticipates that corporate political investments will be larger on average when statutes are stringent and that even pro-industry legislative coalitions will benefit politically from the existence of a minimal regulatory state.

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