Firm heterogeneity and lobby participation

Bombardini, Matilde

doi:10.1016/j.jinteco.2008.03.003

Cited by 228 publications

(173 citation statements)

References 27 publications

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“…50 Second, we control for firm size, labor productivity and industry concentration, which can affect the degree of protection through their impact on lobbying pressure (e.g. Mitra, 1999;Bombardini, 2008) and may also be correlated with firms' ownership structures.…”

Section: Additional Controlsmentioning

confidence: 99%

“…In that year, the prevailing tariffs resulted from the eight-year Uruguay Round of trade negotiation that was completed ten years earlier. 5 Finally, while larger firm size and more industry concentration might lead to higher final good tariffs by alleviating free-riding problems in lobbying (Mitra, 1999;Bombardini, 2008), there is little reason to believe that vertical structure should have such an effect. 6 The effect of product prices on integration that we investigate should apply broadly, to many different markets.…”

Section: Introductionmentioning

confidence: 99%

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Do Prices Determine Vertical Integration?

Alfaro

Conconi

Fadinger

et al. 2016

Review of Economic Studies

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What is the relationship between product prices and vertical integration? While the literature has focused on how integration affects prices, this paper provides evidence that prices can affect integration. Many theories in organizational economics and industrial organization posit that integration, while costly, increases productivity. It follows from firms' maximizing behavior that higher prices induce more integration. The reason is that at low prices, increases in revenue resulting from enhanced productivity are too small to justify the cost, whereas at high prices the revenue benefit exceeds the cost. Trade policy provides a source of exogenous price variation to assess the validity of this prediction: higher tariffs should lead to higher prices and therefore to more integration. We construct firmlevel indices of vertical integration for a large set of countries and industries and exploit cross-section and time-series variation in import tariffs to examine their impact on firm boundaries. Our empirical results provide strong support for the view that output prices are a key determinant of vertical integration. JEL classifications: D2, L2, Keywords: Theory of the firm, vertical integration, product prices. * We are grateful to Daron Acemoglu, Robby Akerlof, Nick Bloom, Francesco Decarolis, Bob Gibbons, Davin Chor, Gene Grossman, Maria Guadalupe, Ali Hortaçsu, Louis Kaplow, Patrick Legros, Margaret McMillan, Emanuel Ornelas, Mike Powell, Raffaella Sadun, Chad Syverson, John Van Reenen, Chris Woodruff and numerous seminar and conference participants for their valuable suggestions and comments. Research funding from the FNRS and the European Commission (PEGGED collaborative project) is gratefully acknowledged by Conconi. For their hospitality and support, Newman is grateful to the Yale Economic Growth Center and the Brown Population Studies and Training Center. We thank Francisco Pino, Andrea Colombo and Qiang Wang for excellent research assistance.

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Section: Additional Controlsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Do Prices Determine Vertical Integration?

Alfaro

Conconi

Fadinger

et al. 2016

Review of Economic Studies

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“…Furthermore, 24% of the counties have a net positive gain from the policy. 27 See Bombardini (2008) for more recent work on the relationship between heterogeneous gains and lobbying. 28 In determining the consumer surplus loss under CAT, we assume that carbon market revenue is returned to consumers in a lump-sum fashion.…”

Section: The Political Economy Of Climate Change Policymentioning

confidence: 99%

Some Inconvenient Truths About Climate Change Policy: The Distributional Impacts of Transportation Policies

Holland

Hughes

Knittel

et al. 2011

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Abstract-Climate policy has favored costly measures that implicitly or explicitly subsidize low carbon fuels. We simulate four transportation sector policies: cap and trade (CAT), ethanol subsidies, a renewable fuel standard (RFS), and a low carbon fuel standard. Our simulations confirm that alternatives to CAT are 2.5 to 4 times more costly but are amenable to adoption due to right-skewed distributions of gains. We analyze voting on the WaxmanMarkey (WM) CAT bill. Conditional on a district's CAT gains, a district's RFS gains are negatively correlated with the likelihood of voting for WM. Our analysis supports campaign contributions as a partial mechanism.

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“…Our paper relates to the literature on international protection for sale (Grossman and Helpman, 1994;Imai, Katayama and Krishna, 2008;Bombardini, 2008;Goldberg and Maggi, 1999). 5 4 Moreover, using a sample period of 1965-1992, Kortum and Lerner (2000) found that VC investments, which support small innovative firms, have a positive impact on patent count at the industry level, and that this positive impact is larger than that of R&D expenditures.…”

Section: Introductionmentioning

confidence: 98%

“…We differ from that literature by examining the effects of R&D policy when R&D is conducted by independent entrepreneurs rather than incumbents. 6 Then, we add 6 An exception is Impullitti (2010) which, to our knowledge, is the only paper in the endogenous growth literature studying how R&D subsidies (policy) are affected by international competition, and which allows both entrants and incumbents to undertake R&D. Focusing on long-run dynamic effects, the author solves the model by calibration and shows that increased foreign competition (more foreign firms) increases R&D subsidies due to a business stealing effect (our strategic innovation effort effect) and a growth effect. We differ by focusing on the direct effect which enables us to derive analytical solutions and empirically testable predictions.…”

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confidence: 99%

Entrepreneurship policy and globalization

Norbäck

Persson

Douhan

2014

Journal of Development Economics

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What explains the world-wide trend of pro-entrepreneurial policies? We study entrepreneurial policy in a lobbying model taking into account the conflict of interest between entrepreneurs and incumbents. It is shown that international market integration leads to more pro-entrepreneurial policies, since it is then (i) more difficult to protect domestic incumbents and (ii) pro-entrepreneurial policies make foreign entrepreneurs less aggressive.Using the World Bank Doing Business database, we find evidence that international openness is negatively correlated with the barriers to entry for new entrepreneurs, as predicted by the theory.JEL codes: L26; L51; O31; F15; D73

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Firm heterogeneity and lobby participation

Cited by 228 publications

References 27 publications

Do Prices Determine Vertical Integration?

Do Prices Determine Vertical Integration?

Some Inconvenient Truths About Climate Change Policy: The Distributional Impacts of Transportation Policies

Entrepreneurship policy and globalization

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