Rent dissipation, free riding, and trade policy

Article Abstract:

The failure of sunrise industries, or growing and profitable industries, to lobby for government support is caused by the prospect for free riding rather than the threat of rent dissipation. The potential for free riding discourages vigorous lobbying because it will allow late industrial entrants to enjoy benefits without any contribution. In contrast, sunset or declining industries enjoy trade protection owing to lobbying campaigns. There is no threat of free riding since its declining state would hinder new entrants.

Analysis, Political aspects, Industry, Industries, Lobbyists, Economic rent

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Competing for endorsements

Article Abstract:

A model of two-party election with interest-group endorsements is developed to examine the conditions under which candidates compete for endorsements and effects of political endorsements on policy outcomes. Results show that competition for an interest group's endorsement could lead to overrepresentation of its members, thereby lowering aggregate welfare. Although the model considers only a single interest group, results suggest that it can be extended to situations with multiple endorsers.

Political activity, Politicians, Endorsements, Pressure groups, Special interest groups

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Intergenerational redistribution with short-lived governments

Article Abstract:

The modeling of the intergenerational redistributive policies of politicians show that such a policy can result in multiple polical equilibria that tends to place political gains before social welfare. The adoption of a redistributive policy at any time in the elected officials career is bound to marginalize either the young or old generation of constituents, and has the added disadvantage of dissipating economic output via low consumption.

Public Finance Activities, Fiscal Policy, Social aspects, Models, Taxation, Welfare, Public assistance

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