Caps on Political Lobbying: Reply

摘要

Yeon-Koo Che and Ian L. Gale (1998) (CG, hereafter) studied the impact of imposing a cap on lobbying expenditures. They showed that a cap may lead to (a) greater expected aggregate expenditure, and (b) a less efficient allocation of a political prize. In their comment, Todd Kaplan and David Wettstein (2006) (KW, hereafter) show that if the cap is not rigid (i.e., its impact on the cost of lobbying is continuous) it has no effect.