1st Edition

The Political Power of Business Structure and Information in Public Policy-Making

By Patrick Bernhagen Copyright 2007
    192 Pages 6 B/W Illustrations
    by Routledge

    192 Pages 6 B/W Illustrations
    by Routledge

    This book analyzes the influence of business in democratic politics. Advice from business actors regularly carries more weight with policymakers than other interests because it refers to the core of the state-market nexus in democratic capitalism: the consequences for voters and policymakers of harming business and the economy. The book examines the resulting informational and structural constraints on public policymaking and their strategic use by business lobbyists.

    While the role of information is frequently acknowledged in studies on business political influence, very few empirical analyses of its strategic use exist. This book outlines a theoretical model of the role of information and its asymmetric supply for business actors’ ability to influence policy. Focusing on banking regulation and environmental politics, the informational–structural view of business power is evaluated empirically in a cross-national, multi-level research design involving case studies as well as quantitative analyses of elite survey data and policy outcomes in advanced capitalist democracies.

    Patrick Bernhagen suggests that, while democracy in capitalist society is vulnerable to a pro-business policy bias, better informed policymakers can redress the balance of power with business and improve on bringing policies in line with public preferences. His analysis identifies the institutional and behavioural factors affecting business’ informational power. The Political Power of Business will be of particular interest to students and researchers of political science, policymaking and business studies.

    Tables and Figures

    Acknowledgements

    1 INTRODUCTION

    Linking Action and Structure: The Power of Being Informed

    Approach and Methods

    Key Terms and Concepts

    Structure of the Book

    2 GROUPS, INSTITUTIONS, NETWORKS, IDEOLOGY, OR STRUCTURAL DEPENDENCE: WHAT DRIVES BUSINESS POWER?

    Pluralism and the Study of Business as an Interest Group

    Neocorporatist Systems and Coordinated Market Economies

    The Analysis of Elite Networks and Policy Communities

    Ideological Dominance

    Structural Explanations of Business Dominance

    3 AN INFORMATIONAL–STRUCTURAL MODEL OF BUSINESS POWER

    Informational Asymmetries Between Business Actors and Policymakers

    Signalling Models of Lobbying

    Reputation and Lobbying

    4 TWO REAL-WORLD SIGNALLING GAMES

    A Note on Case Selection

    Regulation of Small Business Banking in England and Wales

    Phasing out PVC from Public Construction in Hesse

    Discussion

    5 REPUTATION AND INFORMATIVENESS IN LOBBYING

    Data: The 1996 European Members of Parliament Study

    Lobbying, Reputation Costs, and Ideological Proximity

    Business Contacts and Influential Lobbying

    Discussion

    6 STRUCTURE, INFORMATION, AND ENVIRONMENTAL REGULATION

    Business Preferences on Environmental Regulation

    Dowsing Flooded Fields for Underground Water

    Measuring Structural Constraints and Information Asymmetry

    Sources and Limits of Business Power: International Trade, Neocorporatism and Eco Groups

    7 CONCLUSIONS: INFORMATION, STRUCTURE, AND THE PROSPECTS FOR DEMOCRACY UNDER CAPITALISM

    Informational Asymmetry in the Repertoire of Political Recourses

    Outlook: Can Policymakers’ Information Problems Be Alleviated?

    Appendix A: Interviews and Personal Communications

    Appendix B: Coding and Data Sources of Variables Used in Ch. 5

    Appendix C: Coding, Data Sources and Summary Statistics of Variables Used in Ch. 6

    Appendix D: Jack-knifed Estimates of Regression Models in Ch. 6

    Bibliography

    Biography

    Patrick Bernhagen is Lecturer at the Department of Politics and International Relations, University of Aberdeen, UK.