%0 Report
        %A Bellani, Luna
%A Fabella, Vigile Marie
%A Scervini, Francesco
        %T Strategic Compromise, Policy Bundling and Interest Group Power
        %D 2020
        %8 2020 Dec
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 13924
        %U https://www.iza.org/publications/dp13924
        %X Policy reforms are often multifaceted. In the rent-seeking literature policies are usually taken as one-dimensional. This paper models policy formation using a political contest with endogenous policy proposals containing two dimensions. The two dimensions provide an opportunity to trade off one policy over another to make the lobbying opposition less aggressive. In a first stage, the Government proposes a reform over the two policies, and in a second stage engages in a contest with an Interest Group over the enactment of the proposed reform. As a result, the Government makes a compromise, under-proposing in the policy the Interest Group opposes and over-proposing in the policy the Interest Group desires. Effectively, there will be strategic bundling of desired policies with undesired ones in an attempt to increase enactment probability and overall utility.
        %K lobbies
%K political reforms
%K contest