The Dynamics of Firm Lobbying

William R. Kerr; William F. Lincoln; Prachi  Mishra

Article | American Economic Journal: Economic Policy | November 2014

The Dynamics of Firm Lobbying

by William R. Kerr, William F. Lincoln and Prachi Mishra

Abstract

We study the determinants of the dynamics of firm lobbying behavior using a panel data set covering 1998–2006. Our data exhibit three striking facts: (i) few firms lobby, (ii) lobbying status is strongly associated with firm size, and (iii) lobbying status is highly persistent over time. Estimating a model of a firm's decision to engage in lobbying, we find significant evidence that up-front costs associated with entering the political process help explain all three facts. We then exploit a natural experiment in the expiration in legislation surrounding the H-1B visa cap for high-skilled immigrant workers to study how these costs affect firms' responses to policy changes. We find that companies primarily adjusted on the intensive margin: the firms that began to lobby for immigration were those who were sensitive to H-1B policy changes and who were already advocating for other issues, rather than firms that became involved in lobbying anew. For a firm already lobbying, the response is determined by the importance of the issue to the firm's business rather than the scale of the firm's prior lobbying efforts. These results support the existence of significant barriers to entry in the lobbying process.

Keywords: lobbying; political economy; immigration; H-1B; Organizational Change and Adaptation; Policy; Immigration;

Format: Print

Read Now

Citation:

Kerr, William R., William F. Lincoln, and Prachi Mishra. "The Dynamics of Firm Lobbying." American Economic Journal: Economic Policy 6, no. 4 (November 2014): 343–379.

Talent is the most precious resource for today’s knowledge-based economy, and a significant share of the U.S. skilled workforce in technology fields is foreign born. The United States has long held a leading position in attracting global talent, but the gap to other countries is shrinking. Immigration policies like the H-1B visa program shape the admissions of foreign workers to the country and grant a particularly strong gatekeeping role to sponsoring firms and universities. This chapter explores the data around global talent flows and some of the economic implications of an employer-driven immigration approach.

Case | HBS Case Collection | September 2019 (Revised December 2019)

Google: To TVC or Not to TVC?

William R. Kerr and Carl Kreitzberg

In late 2018, evidence emerged that many of Google’s temporary help agency workers, vendors, and independent contractors (“TVCs”) were unhappy with the company. TVCs, who reportedly made up 49.95% of Google’s 170,000 person global workforce, had raised concerns of mistreatment, citing instances of pay inequity, social exclusion, and physical endangerment. “Flexible” workers, such as TVCs, were often seen as a key cog for Silicon Valley’s IT companies: they made workforces scalable, they helped firms get access to specialized knowledge for temporary projects, and they boosted innovation by creating “knowledge spillovers” between firms. But, at the same time, many onlookers worried that flexible work arrangements were aggravating social inequality and making more jobs precarious. Google employees, major media outlets, and politicians demanded that the company change its policies on TVCs. One suggestion was that Google convert all of its TVCs to full-time status by early 2020. As tensions reportedly escalated between Google’s workforce and its management team, some began to wonder if Google was still an employer of choice.

Keywords: workforce; independent contractors; talent management; Silicon Valley; google; employee attitude; Employee compensation; employee engagement; future of work; innovation; innovation and strategy; inequality; talent acquisition; Labor; Talent and Talent Management; Strategy; Technological Innovation; Employees; Attitudes; Innovation and Management; Human Resources; Equality and Inequality; Information Technology Industry; United States; San Francisco;

Citation:

Kerr, William R., and Carl Kreitzberg. "Google: To TVC or Not to TVC?" Harvard Business School Case 820-048, September 2019. (Revised December 2019.) View Details

Cite View Details Educators Purchase

This primer is meant to be a field guide to the late 2010s' surge in business use of "Artificial Intelligence" (AI), or enterprise software based in machine learning. First, it provides an overview of the key trends - digitization, connectivity, the continuation of Moore's law, and advancements in machine learning algorithms - which led to the inflection point in adoption of AI. Then, the primer describes the range of use cases of state-of-the-art enterprise AI organized in a taxonomy designed to build generalized understanding of the types of work to which AI can be applied. This knowledge is useful not only to managers looking to best leverage the technology but to those working to manage resulting organizational change and prepare the workforce for transitions into complementary tasks. Finally, key issues and implications of AI adoption are also discussed.

Faculty & Research

The Dynamics of Firm Lobbying

Abstract

Citation:

About the Author

More from the Author