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methodology, hypothesis, and data used in interest groups and economic efficiency has
been proposed (e.g., Joskow; Noll).
this study. The remaining sections present
empirical findings and conclusions.
These theories have been tested in the util-
ity industry (e.g., Nelson), oil industry (e.g.,
Becker), transportation (e.g., Teske, Best, and
Minstrom), agriculture (e.g., Gardner 1983,
1987; Bullock 1992a, 1992b; Rausser and
Foster), and forestry (Kalt; Mehmood and
Zhang). Nelson found that the existing rate
structure in the electric utility industry is
consistent with the Ramsey theory of regu-
lation, as opposed to Stigler–Peltzman ver-
sion of the capture theory. Becker, Gardner
(1983, 1987), Kalt, Mehmood and Zhang,
and Teske, Best, and Minstrom, on the other
hand, found evidence supporting the cap-
ture theory. Two articles by Ando (1997,
1999) are, to our knowledge, the only interest
group analyses of ESA-related issues from
a public choice perspective. Ando (1999)
did not find any evidence of competition
among pressure groups in order to hasten or
delay the listing of an endangered species.
Although Stigler–Peltzman–Becker models of
regulation emphasize the importance of leg-
islators’ self-interest in determining their
behavior, the influence of legislators’ ideol-
ogy has gained much prominence in recent
empirical studies (Peltzman 1983; Hird).
Although there has been no empirical
research on ESA votes, the economic litera-
ture contains numerous voting studies. Early
works considered legislators either as “dele-
gates,” who vote according to voters’ wishes,
or “trustees,” who use their own ideology
for voting decisions (Coates and Munger).
Recent studies have focused more on the
notion of “delegates,” claiming that the use
of legislators’ own ideology is tantamount
to “shirking.” However, some of these stud-
ies have found ideology as a significant fac-
tor in voting behavior and concluded that
the Stigler–Peltzman theory of politics was
erroneous (e.g., Kau and Rubin; Peltzman
1983; Kalt and Zupan; Poole and Romer).
On the other hand, Coates and Munger
argue that studies on ideology and shirk-
ing are often flawed because they are not
tied to a model of behavior. Hird exam-
ined House and Senate votes on Superfund
and found that legislator behavior repre-
sents their environmental and liberal ideol-
ogy as well as narrowly defined self-interest.
On the other hand, several studies on envi-
ronmental legislation voting (e.g., Crandall;
Literature Review
Stigler and Peltzman (1976) laid out the foun-
dation for analyzing regulation as a means to
capture rents by competing interests. Accord-
ing to Stigler, there are two principal theo-
ries of regulation. The public interest theory
assumes that decisions by legislators (and
other public officials) act in the public inter-
est (i.e., maximizing social welfare). Interest
group theory (or capture theory, constituent
interest theory), on the other hand, assumes
that such decisions are based on the avail-
ability of rents and the ability of legislators
to maximize them with respect to their own
self-interest (Stigler; Zusman; Peltzman 1976;
Rausser; Becker).
Based on Stigler’s theory of regulation,
Peltzman (1976) constructed a model for the
political market. In his model the regulator
seeks to maximize a majority, which is a func-
tion of total number of potential voters, num-
ber of voters in the beneficiary group, and
probabilities that the voters in the benefi-
ciary group will support and those who are
taxed will oppose the proposed legislation.
In addition, regulators often seek to bene-
fit few while taxing many because they have
an incentive to restrict the size of a winning
group and to spread the losses rather than the
benefits over a large population (Peltzman;
Becker). Becker modeled the competition
among interest groups for political influence.
His analysis shows that groups that are rela-
tively efficient at producing political pressure
are likely to be the winners. Therefore, the
principal contributing factor to the success of
a pressure group is not the absolute efficiency
of the group itself but the efficiency of the
group compared to others.
Both public interest and interest group the-
ories have empirical support, although inter-
est group theory has recently fared better
than public interest theory (e.g., Kalt and
Zupan; Peltzman; Berg and Tschirhart; Noll;
Teske, Best, and Minstrom). Sometimes eco-
nomically efficient choices may coincide with
choices in the interest of one or more groups,
and there is a need to disentangle economic
and political influences. Accordingly, a hybrid Pashigan;Ackerman and Hassler) have found
theory that allows for the influence of both self-interest rather than ideology determines