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Integrated Market and Nonmarket Strategies in Client and Interest Group Politics

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  • Baron David P.

    (Graduate School of Business, Stanford University, Stanford, CA 94305-5015, USA. Tel: (650) 723-3757; Fax: (650) 725-6152)

Abstract

This paper provides a model of integrated market and nonmarket strategies in the context of an industry facing regulation that differentially affects the firms in the industry. The regulation is chosen in a majority rule institution, and to affect the stringency of the regulation, the firms in the industry can take nonmarket action in the form of providing support to legislators based on how they vote. The nonmarket action is considered in the context of client and interest group politics, where the latter involves competition with an environmental interest group. An integrated strategy is composed of the firm's strategy for its market environment and its strategy for its nonmarket environment. Also the integrated strategies of the firms must constitute an equilibrium in their market competition and an equilibrium for their nonmarket competition, including that with the environmental interest group. Collective action in the form of coalition building and rent chain mobilization is also considered.

Suggested Citation

  • Baron David P., 1999. "Integrated Market and Nonmarket Strategies in Client and Interest Group Politics," Business and Politics, De Gruyter, vol. 1(1), pages 7-34, December.
    • Handle: RePEc:bpj:buspol:v:1:y:1999:i:1:p:7-34:n:4
    DOI: 10.1515/bap.1999.1.1.7
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    Citations

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    Cited by:

    1. John M. de Figueiredo, 2009. "Integrated Political Strategy," NBER Working Papers 15053, National Bureau of Economic Research, Inc.
    2. Tomaso Duso & Astrid Jung, 2012. "Product Market Competition and Lobbying Coordination in the U.S. Mobile Telecommunications Industry," Journal of Industry, Competition and Trade, Springer, vol. 12(2), pages 177-201, June.
    3. John M. de Figueiredo & Emerson H. Tiller, 2000. "The Structure and Conduct of Corporate Lobbying: How Firms Lobby the Federal Communications Commission," NBER Working Papers 7726, National Bureau of Economic Research, Inc.
    4. Henisz, Witold J. & Zelner, Bennet A., 2006. "Interest Groups, Veto Points, and Electricity Infrastructure Deployment," International Organization, Cambridge University Press, vol. 60(1), pages 263-286, January.
    5. Tomaso Duso & Astrid Jung, 2007. "Market Conduct and Endogenous Lobbying: Evidence from the U.S. Mobile Telecommunications Industry," Journal of Industry, Competition and Trade, Springer, vol. 7(1), pages 9-29, March.
    6. De Figueiredo, John M. & De Figueiredo, Rui J. P. Jr., 2002. "The Allocation of Resources by Interest Groups: Lobbying, Litigation and Administrative Regulation," Working papers 4247-02, Massachusetts Institute of Technology (MIT), Sloan School of Management.
    7. De Figueiredo, John M. & De Figueiredo, Rui J. P. Jr., 2002. "Managerial Decision-Making in Non-Market Environments: A Survey Experiment," Working papers 4246-02, Massachusetts Institute of Technology (MIT), Sloan School of Management.
    8. John M. de Figueiredo & James J. Kim, 2004. "When Do Firms Hire Lobbyists? The Organization of Lobbying at the Federal Communications Commission," NBER Working Papers 10553, National Bureau of Economic Research, Inc.
    9. White, George O. & Hemphill, Thomas A. & Joplin, Janice R.W. & Marsh, Laurence A., 2014. "Wholly owned foreign subsidiary relation-based strategies in volatile environments," International Business Review, Elsevier, vol. 23(1), pages 303-312.
    10. Tomaso Duso & Astrid Jung, 2007. "Market Conduct and Endogenous Lobbying: Evidence from the U.S. Mobile Telecommunications Industry," Journal of Industry, Competition and Trade, Springer, vol. 7(1), pages 9-29, March.
    11. John M. de Figueiredo & Rui J.P. de Figueiredo, 2002. "The Allocation of Resources by Interest Groups: Lobbying, Litigation and Administrative Regulation," NBER Working Papers 8981, National Bureau of Economic Research, Inc.
    12. de Figueiredo, John & Kim, James, 2004. "When Do Firms Hire Lobbyists? The Organization of Lobbying at the Federal Communications Commission," Working papers 4483-04, Massachusetts Institute of Technology (MIT), Sloan School of Management.
    13. Tomaso Duso & Astrid Jung, 2012. "Product Market Competition and Lobbying Coordination in the U.S. Mobile Telecommunications Industry," Journal of Industry, Competition and Trade, Springer, vol. 12(2), pages 177-201, June.

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