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Doing More for Less? New Evidence on Lobbying and Government Contracts, Senay Agca, Deniz Igan, Fuhong Li, Prachi Mishra

Abstract
Why do firms lobby? This paper exploits the unanticipated sequestration of federal budget accounts in March 2013 that reduced the availability of government funds disbursed through procurement contracts to shed light on this question. Following this event, firms with little or no prior exposure to the federal accounts that experienced cuts reduced their lobbying spending. In contrast, firms with a high degree of exposure to the cuts maintained and even increased their lobbying spending. This suggests that, when the same number of contractors competed for a piece of a reduced pie, the more affected firms likely intensified their lobbying efforts to distinguish themselves from the others and improve their chances of procuring a larger share of the smaller overall. These findings are stronger in government-dependent sectors and when there is intense competition. The evidence is more consistent with a rent-seeking explanation for lobbying
Table Of Contents
Cover -- Contents -- I. Introduction -- II. Background -- A. Related Literature -- B. Sequestration -- C. Politically Targeted Activities -- III. Data and Empirical Methodology -- A. Data -- 1. Federal Contracts -- 2. Lobbying -- 3. Office of Management and Budget (OMB) Report -- 4. Financial Variables -- B. Empirical Methodology -- C. Descriptive Statistics -- IV. Analyses and Findings -- A. Univariate Results -- B. Panel Estimations -- C. Discussion of Findings -- V. Conclusion -- References -- Tables -- 1. Descriptive Statistics -- 2. Comparison of Lobbying across the Event Line -- 3. Lobbying after Sequestration -- 4. Placebo Test -- 5. Industry Concentration -- 6. Firm Level Competition -- 7. Agency Level Competition -- 8. Government Dependence -- 9. Agency Lobbying to Congress Lobbying Ratio -- 10. Contracts after Sequestration - Sequestered Firms -- 11. Operating Performance - Sequestered Firms -- Figures -- 1. Market Reaction to Sequestration -- 2. Lobbying around Sequestration -- 3. Firm versus Association Lobbying around Sequestration -- Appendices -- 1. Variable Descriptions and Data Sources -- 2. Lobbying Reports: A Sample -- 3. Industry Composition
Language
eng
Literary Form
non fiction
Physical Description
1 online resource (48 pages)
Specific Material Designation
remote
Form Of Item
online
Isbn
9781513511276

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