Lobbying Across Venues and Policies : A Comparison of Interest Group Activities at the State and Federal Levels 1

We study interest groups’ decisions about the policy-making institution in which to press for policy change. Most research about lobbying activities focuses within a single institution (the legislature, the bureaucracy), but groups and lobbyists generally can choose from among multiple venues. Further, some important questions about organized interests and the policy process require studying lobbying behavior across several venues. Here we study lobbying behavior in both the legislative and administrative venues, using data at the Federal level filed under the Lobbying Disclosure Act and from lobbying reports in the state of Minnesota; each data set has unique features that exploit. We address two questions using these data. First, how do groups allocate their lobbying efforts across venues? We find that the vast majority of groups lobby the legislature, but that a large proportion of groups also lobby the bureaucracy. Second, we study the distribution of lobbying across policy areas to determine whether the locus of lobbying activity is in different venues for different policy areas. Our results strongly reject this claim: the level of interest group activity in one venue is highly related to the level in the other venue. Since the creation of administrative agencies with broad, standing discretion, the authority to initiate policy change in the U.S. has not been confined to any single institution or branch of government. Legislatures certainly maintain their constitutionally-granted right to initiate change. But executive branch or independent agencies can often, pursuant to an authorizing statute, independently initiate policy changes on the same issue. At some level the exercise of such authority must pass muster with the constitutional branches (the massive but ill-fated workplace ergonomics regulation program, issued by the U.S. Department of Labor in the last days of the Clinton Administration, comes to mind). But the standing discretionary authority of agencies changes the status quo from rejection to acceptance of an agency’s action, and time-constrained legislators face transaction and attention costs as they attempt to learn about, and possibly change, the policy decisions of bureaucrats. This creates a measure of autonomy1 in administrative agencies, and makes the policy process as a whole more of a “parallel system” (Bendor 1985). This presents seekers of policy change with a choice: which policy-making venue is the best one in which to press a case for change? Assuming their activities are consequential, the way in which organized interests sort themselves across venues is crucial for any assessment of the policy process as a whole. In particular, the hopeful argument that formal requirements of openness and participation in bureaucratic policy-making can overcome biases in the pressure group system basically requires that some groups (ideally those disadvantaged in the legislature) sort disproportionately into administrative lobbying. Studying such questions of venue choice requires information that connects the behavior of lobbyists and the issues they target in multiple policy-making institutions. Yet almost all existing evidence on lobbying activities focuses within a single venue — the legislature, in a huge literature (see Baumgartner and Leech 1998), or administrative agencies, in a growing literature (especially related to notice-and-comment rulemaking; see Golden 1998, Furlong 1997, Furlong and Kerwin 2005, and Yackee and Yackee 2006). For our purposes it is necessary to link the behavior of organized interests across policy-making venues. Doing this allows us to compare interest group lobbying across venues and also to ascertain how representation varies across multiple venues. Because of the linkage across venues in our data, our findings advance the growing literature In a principal-agent context with asymmetric information, some minimal autonomy for the agent is generally unavoidable. It is more commonly known as “agency loss. ”