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An optimal auction perspective on lobbying

Author

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  • Richard T. Boylan

    (Washington University, Olin School of Business)

Abstract

The lobbying process has been described as an auction (see, for instance, Bernheim and Whinston). The auction rules picked are supposed to be descriptive, however they vary from author to author. An optimal auction for a government official leads to the same policy as in Bernheim and Whinston, although contributions are different. A necessary condition for an auction to be optimal is that it allows contributions from the government official to the lobby. The proof of these results depends on an extension of the work by Bernheim and Whinston on implementation in environments with complete information. In particular all choice functions are Coalition-Proof Nash equilibrium implementable when individuals preferences can be represented by quasi-linear utility functions bounded with respect to all variables -- except for money.

Suggested Citation

  • Richard T. Boylan, 1996. "An optimal auction perspective on lobbying," Public Economics 9602001, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwppe:9602001
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    References listed on IDEAS

    as
    1. Michael R. Baye & Dan Kovenock & Casper G. Vries, 2008. "Rigging the lobbying process: An application of the all-pay auction," Springer Books, in: Roger D. Congleton & Kai A. Konrad & Arye L. Hillman (ed.), 40 Years of Research on Rent Seeking 2, pages 331-336, Springer.
    2. B. Douglas Bernheim & Michael D. Whinston, 1986. "Menu Auctions, Resource Allocation, and Economic Influence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 101(1), pages 1-31.
    3. Bernheim, B. Douglas & Peleg, Bezalel & Whinston, Michael D., 1987. "Coalition-Proof Nash Equilibria I. Concepts," Journal of Economic Theory, Elsevier, vol. 42(1), pages 1-12, June.
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    Citations

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    Cited by:

    1. Persson, Torsten & Tabellini, Guido, 2002. "Political economics and public finance," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 3, chapter 24, pages 1549-1659, Elsevier.
    2. Bertoletti, Paolo, 2006. "On the reserve price in all-pay auctions with complete information and lobbying games," MPRA Paper 1083, University Library of Munich, Germany.
    3. Theo Eicher & Thomas Osang, 2002. "Protection for Sale: An Empirical Investigation: Comment," American Economic Review, American Economic Association, vol. 92(5), pages 1702-1710, December.
    4. Mikael Priks, 2011. "Judiciaries in corrupt societies," Economics of Governance, Springer, vol. 12(1), pages 75-88, March.
    5. Mikael Priks, 2012. "Competition among officials and the abuse of power," Public Choice, Springer, vol. 150(3), pages 425-438, March.

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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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