Legislative Structure, Incentives, and Informational Lobbying

We analyze the incentives for interest groups to lobby the legislature for favorable policy and compare two institutional frameworks, a U.S. Congress-style legislature and a European-style parliament. The results provide a rationale for why lobby groups are more active in the U.S. Congress. The key institutional feature to explain the different behavior of interest groups is that in the congressional system majority coalitions can differ across policy issues and transcend party lines, whereas in a parliamentary system the majority coalition is given for the duration of a government. We show that this flexibility creates an incentive for interest groups to play an active role in the design of policy in the congressional system, while the lack of it dissuades lobbying in a parliamentary system.