Interest Groups and Economic Growth Rates

Research output: Contribution to journalArticlepeer-review

19 Scopus citations

Abstract

Olson (1982) has argued that the greater the density of interest organizations in a society, the slower its rate of economic growth. Interest groups have no inhibitions about lobbying for policies that depress growth because they obtain the benefits of such policies in full while paying a fraction of their cost. An exception to this rule is the “encompassing” interest organization: because of its size, its members are bound to “internalize” much of the external costs of such policies. Consequently Olson predicts that such an organization will tend to have less parochial — and so less growth-defeating — legislative objectives. This prediction is tested for both business and labor using political action committee contribution data.

Original languageEnglish (US)
Pages (from-to)44-58
Number of pages15
JournalThe Journal of Politics
Volume47
Issue number1
DOIs
StatePublished - Feb 1985

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