This paper shows how competition between interests can internalize economic externalities groups. The key feature is that some lobby groups give political voice to environmental demands. We illustrate the basic ideas in a common agency model of politics, into which we introduce a negative output...

In this paper, we consider strategic entry decisions in a two-player political transfer contest, i.e., the prize is a transfer from one lobby group to another. The size of the transfer depends on the lobbying effort of the political active lobby groups. We show that the entry decision involves a...