@TechReport{iza:izadps:dp1918, author={Miettinen, Topi and Poutvaara, Panu}, title={Political Parties and Network Formation}, year={2006}, month={Jan}, institution={Institute of Labor Economics (IZA)}, address={Bonn}, type={IZA Discussion Paper}, number={1918}, url={https://www.iza.org/publications/dp1918}, abstract={We argue that anti-corruption laws may provide an efficiency rationale for why political parties should meddle in the distribution of political nominations and government contracts. Anti-corruption laws forbid trade in spoils that politicians distribute. However, citizens may pay for gaining access to politicians and, thereby, to become potential candidates for nominations. Such rent-seeking results in excessive network formation. Political parties may reduce wasteful network formation, thanks to their ability to enter into exclusive membership contracts. This holds even though anti-corruption laws also bind political parties.}, keywords={political parties;two-sided platforms;rent-seeking;network formation}, }