De Figueiredo on Political Strategy

9 June 2009 at 10:01 am 1 comment

| Peter Klein |

We’ve previously mentioned the chapters by Nicolai and Nils Stieglitz and by Lasse and me in the forthcoming Advances in Strategic Management volume titled Economic Institutions of Strategy. John de Figueiredo’s chapter, “Integrated Political Strategy,” is now available as an NBER Working Paper. John is a leader of this emerging field, which studies how firms attempt to influence the legal and political environment to achieve competitive advantage. As he points out:

Legal and acceptable competitive behavior is determined endogenously by legislators, regulators and judges who are influenced, positively and negatively, by the very same firms the regulations are designed to control. By understanding the theories of how firms affect politics, one can better determine how to gain competitive advantage through political institutions. This is a natural extension of the traditional tools of strategic management. Moreover, for young scholars, this is an area in which the lines of investigation are clear and the openings for serious research opportunities available. In this sense, it is robust area for future research and major contributions to understanding firm performance.

Entry filed under: - Klein -, Institutions, Law and Economics, New Institutional Economics, Strategic Management. Tags: .

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1 Comment Add your own

  • 1. Michael E. Marotta  |  10 June 2009 at 6:41 am

    It is nice to be able to study this dispassionately because liberals and conservatives both recoil from interfacing business with government. As Jane Jacobs pointed out in SYSTEMS OF SURVIVAL, when guardians go into business for themselves and when traders use force, the result is always corruption and oppression. Still, this is how the world works… or much of it, anyway, from the Roman Senate to the US Senate.

    In criminology, we study the many ways that burglars practice their craft, defeating locks, fencing stolen goods, alternating between crime and honest work. We differentiate the neighborhood thief from the cargo hijacker, and carjacking from car cloning. So, it is interesting to study these things.

    Whether and to what extent we accept them as normal, expected and acceptable is another question entirely.

    In numismatics, we have the curious fact that the millionaires who assembled famous collections would have made more money staying in the office. So, too, when businesses make laws: it looks good (or bad, depending on who you are), but a true cost accounting might reveal a different set of facts.

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