Abstract
If the firms in an industry are to be successful in raising money to influence government, two conditions must be met: (1) there must be sufficient rents available from government decisions regarding that industry to make such expenditures worthwhile, and (2) the industry must be sufficiently concentrated to avoid a free-rider problem in fund-raising. This argument, though seemingly intuitively appealing, has been under recent empirical attack; this paper seeks to restore the parapets.
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Assistant chief, Regulatory Economics Section, Antitrust Division, U.S. Department of Justice. I am grateful for helpful comments from John Culbertson, Paul Godek, Ken Heyer, and Thomas Romer, for outstanding research assistance by Maria Ward, and for kind and thorough responses to my questions by Professors Richard Caves and Asghar Zardkoohi. Of course, I alone am responsible for any errors or omissions. In particular, the views expressed are not necessarily those of the Department of Justice. This paper is a considerably revised version of Pittman (1985).
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Pittman, R. Rent-seeking and market structure: Comment. Public Choice 58, 173–185 (1988). https://doi.org/10.1007/BF00125722
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DOI: https://doi.org/10.1007/BF00125722