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State Policy and Lobbying in a Federal System: Evidence from the Production Tax Credit for Renewable Energy, 1998–2012

Published online by Cambridge University Press:  16 April 2021

Sung Eun Kim ,
Johannes Urpelainen  and
Joonseok Yang Open the ORCID record for Joonseok Yang [Opens in a new window]
Sung Eun Kim
Affiliation:
Korea University, Seoul, South Korea
Johannes Urpelainen
Affiliation:
Johns Hopkins University, Washington, DC, USA
Joonseok Yang*
Affiliation:
Sungkyunkwan University, Seoul, South Korea University of California, Irvine, CA, USA
*
Joonseok Yang, Assistant Professor, Department of Political Science and Diplomacy, Sungkyunkwan University, 25-2 Sungkyunkwan-ro, Myeongnyun 3(sam)ga-dong, Jongno-gu, Seoul, 03063, South Korea. Email: [email protected]
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Abstract

State policies shape firms’ incentives to lobby in the United States, but the existing lobbying literature mostly ignores these incentives. Using lobbying records for all electric utilities in the United States from 1998 to 2012, we examine how state policies affect federal lobbying by both proponents and opponents of federal support for the renewable energy policy. Our theory predicts that supportive state policies reduce the returns to lobbying by both proponents and opponents. Empirically, we show that when the federal production tax credit for renewable energy is about to expire, electric utilities from states without renewable portfolio standards become more likely to lobby than those from states with these policies. Because the timing of the expiration of the production tax credit is quasi-random, these findings carry a causal interpretation. Using text analysis techniques, we also show that the lobbying efforts are focused on energy and environmental issues while lobbying on unrelated topics remains unaffected.

Keywords

lobbyingfederal and state policiesenergy and environment
Type
Original Article
Information
State Politics & Policy Quarterly , Volume 21 , Issue 1 , March 2021 , pp. 1 - 30
Copyright
© The Author(s) 2020

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