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Selective Information Provision and Special Interest Influence: The Case of Trade Policy

Abstract A tool used by special interests to influence policies in their favor but rarely treated in the economic literature is examined. Through contributions to the pool of available information, a bias in public perceptions of policy consequences may be created and policymaking accordingly affected. The results in terms of equilibrium protection levels add to but do not overthrow those of traditional analyses involving contributions to campaign funds. The analysis also shows that as long as some influence over perceived policy consequences can be generated by special interest groups, the political power they can wield by means of campaign contributions is much stronger (and more likely to be extensively used) than that predicted by analyses focused exclusively on campaign contributions. Restrictions on one means of special interest influence can therefore yield significant reductions in both protection and the use of resources for political influence purposes.