Business Associations, Lobbying, and Endogenous Institutions

M.J. Larrain Aylwin, J.O. Prüfer

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Are business associations - private, formal, nonprofit organizations designed to promote the common interests of their members - positive or negative for the economy and overall welfare? Scholars from institutional and organizational economics, on the one side, and from industrial organization, law & economics, and public choice, on the other side, have given different answers to this question, which is instrumental for policy making. We construct a model that endogenizes association membership of firms and the main functions of associations, which can have positive or negative spillovers on the economy. We derive predictions regarding associations’ functions and their net welfare effects, depending on the level of property rights securitization, which are in line with empirical observations.
Original languageEnglish
Place of PublicationTilburg
PublisherInformation Management
Number of pages40
Publication statusPublished - 21 Nov 2014

Publication series

NameCentER Discussion Paper


  • Business Associations
  • Trade associations
  • Professional organizations
  • Guilds
  • Lobbying
  • Private Ordering
  • Endogenous institutions
  • Quality of Legal Institutions


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