Focuses on firms’ lobbying practices and attempts at regulatory capture, as well as undue influence to the degree that these activities undermine the ability of the political structure and governmental agencies to serve the public interest.
Political influence can take at least three major forms: direct influence (via lobbying and monetary or in-kind campaign contributions) on legislators and specific legislation; regulatory influence and capture; and conceptual influence on the judicial branch. Political lobbying for specific legislation focuses on individual legislators and can include campaign monetary and other forms of support, e.g. PACs, independent campaign activities, and in-kind services. Lobbying expenditures focus on the day-to-day activities of interest. In practice, more corporate funds usually go into lobbying than campaign support.
Regulatory influence and lobbying is a form of political corruption to the degree that a corporate influence undermines the ability of a regulatory body to serve the public purpose. Regulatory bodies are typically designed to control particular industries or sectors. Regulatory capture is a governmental failure, resulting in rent-seeking behavior by an industry interest group. This behavior creates (or enhances) negative externalities resulting in increased social costs and/or reduced economic efficiency. Regulatory capture is either material or conceptual. Material capture focuses on the self-interest of an industry interest group that unduly promotes the financial and other interests of an industry, while conceptual refers to a phenomenon in which regulatory agents begin to think as the industry does to the exclusion of other perspectives. Conceptual capture results in the exclusion of other potential or actual modes of thinking. Ultimately regulatory capture is a subset of political influence, in this case resulting in the disproportionate success of the most powerful actors.
Judicial conceptual capture takes the forms of various educational activities and retreats and is usually general in nature, e.g. nature of free markets, law and economics.