9308405, PI-Lohmann: This research addresses two problems commonly associated with collective action. First, political outcomes tend to be biased in favor of small, well-organized groups and against large, diffuse groups. As an explanation, it is often argued that smaller groups are more successful in overcoming the free rider problem of collective action. Second, collective action may undermine the credibility of particular regulatory policies. Firms may have disincentives to commit resources when they anticipate that the regulatory environment may change in response to interest groups and public pressures. To date the analysis of these two problems is based on reduced-form models of political participation and decision-making. This project will employ game theoretical techniques to explicitly derive people's incentives to become organized and policymakers' incentives to respond to their pressures. This work will identify the factors affecting the efficiency of political outcomes and the tradeoffs inherent in the political design of regulatory policy.
