This landmark theoretical book is about the mechanisms by which special interest groups affect policy in modern democracies. Defining a special interest group as any organization that takes action on behalf of an identifiable group of voters, Gene Grossman and Elhanan Helpman ask: How do special interest groups derive their power and influence? What determines the extent to which they are able to affect policy outcomes? What happens when groups with differing objectives compete for influence?
The authors develop important theoretical tools for studying the interactions among voters, interest groups, and politicians. They assume that individuals, groups, and parties act in their own self-interest and that political outcomes can be identified with the game-theoretic concept of an equilibrium. Throughout, they progress from the simple to the more complex. When analyzing campaign giving, for example, they begin with a model of a single interest group and a single, incumbent policy maker. They proceed to add additional interest groups, a legislature with several independent politicians, and electoral competition between rival political parties. The book is organized in three parts. Part I focuses on voting and elections. Part II examines the use of information as a tool for political influence. Part III deals with campaign contributions, which interest groups may use either to influence policy makers' positions and actions or to help preferred candidates to win election.
About the Authors
Gene M. Grossman is Jacob Viner Professor of International Economics and Director of the International Economics Section at Princeton University.
Elhanan Helpman is Professor of Economics at Harvard University, the Archie Sherman Chair Professor of International Economic Relations in the Eitan Berglas School of Economics at Tel-Aviv University, and a Fellow at the Canadian Institute for Advanced Research.
"Grossman and Helpman have produced an elegant theoretical foundation for understanding the interactions between groups and politicians in the political economy of a liberal democracy. It should be of 'special interest' to political scientists and economists alike."
—Kenneth A. Shepsle, George D. Markham Professor of Government, Harvard University