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The strategy of firms towards political elites and consumers in polarized western democracies

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The strategy of firms towards political elites and consumers in polarized western democracies

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THE STRATEGY OF FIRMS TOWARDS POLITICAL ELITES AND
CONSUMERS IN POLARIZED WESTERN DEMOCRACIES

by

María Domínguez Pérez

A Dissertation Presented to the
FACULTY OF THE USC GRADUATE SCHOOL
UNIVERSITY OF SOUTHERN CALIFORNIA
In Partial Fulfillment of the
Requirements for the Degree
DOCTOR OF PHILOSOPHY
(POLITICAL SCIENCE AND INTERNATIONAL RELATIONS)

December 2022

Copyright 2022 María Domínguez Pérez

ii

This dissertation is dedicated to my grandmother.

iii
Acknowledgements

I would like to thank my dissertation committee for providing guidance and feedback
throughout this project. Thank you to Dr Gerardo Munck for positively mentoring me since my
first day in the PhD program and encouraging me until the end. To Dr. Christian Grose for
introducing me to experimental methodology. Thank you to Dr. Nan Jia, who patiently and
generously guided me through my research process and interests, who always made me feel
confident in my abilities, who will for always be my role model.
Thanks also to the Centre for International Relations, the Comparative Politics
Workshop in the Political Science and International Relations Department at USC, and the
Nonmarket Strategy Research community at USC Marshall Business School for their feedback
on my work and the funding opportunities to make it happen.
A special thank you to my friends and peers in the PhD program, for the emotional and
intellectual support throughout these years; a special mention to Stefanie Neumeier, Anne Van
Wijk, Joey Saraceno, Sarah Cueva, and Bo Yang. To my parents and aunt, for their generosity
in supporting me in this endeavor so far away from home. To Mac Treschel, for appearing in
my life at the beginning of this journey and for pursuing us at the end of it.

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Table of Contents
Dedication ................................................................................................................................... ii
Acknowledgements ...................................................................................................................... iii
List of Tables ................................................................................................................................ vi
List of Figures ............................................................................................................................. vii
Abstract ...................................................................................................................................... viii
Introduction ................................................................................................................................... 1
Chapter 1: A Resource-Based Perspective of Corporate Political Capabilities: What Are
They and Where Can They Come From? ...................................................................... 5
1.1 Introduction ....................................................................................................................... 5
1.2 What are Political Capabilities? A Taxonomy ........................................................... 10
1.3 From Market Capabilities to Political Capabilities .................................................... 20
1.4 Conclusion ....................................................................................................................... 34
Chapter 2: Does it Pay for Firms to Be Progressive? The Asymmetric Effect of Corporate
Sociopolitical Activism on Consumers’ Buycott and Boycott Responses ................. 38
2.1 Introduction ..................................................................................................................... 38
2.2 Theoretical Background: Political Consumerism and Consumers’
Asymmetric Boycott and Buycott Practices ...................................................................... 41
2.3 Theory and Hypotheses: Asymmetric Effect of Corporate Sociopolitical
Activism on Consumers’ Buycott and Boycott Responses ............................................. 43
2.4 Experimental Design ...................................................................................................... 52
2.5 Results .............................................................................................................................. 59
2.6 Conclusion ....................................................................................................................... 66
Chapter 3: Private Groups vs Public Interests: Who Has Greater Access to Legislators?
A Lobbying Field Experiment and Survey in Spain ................................................... 69

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3.1 Introduction ..................................................................................................................... 69
3.2 A Gap in Research on Interest Group Representation Bias ...................................... 73
3.3 A Theory on the Effect of Interest Type on Initial Political Access ....................... 74
3.4 Case Selection ................................................................................................................. 78
3.5 Study 1: Lobbying Field Experiment .......................................................................... 79
3.6 Study 2: Original Elite Survey on Interest Group Access ........................................ 90
3.7 Conclusion ....................................................................................................................... 92
Conclusion ................................................................................................................................... 97
References ................................................................................................................................ 100

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List of Tables

2.1 Summary of Hypotheses ............................................................................................. 51
2.2 Summary of Treatment Conditions as Displayed to Subjects ...................................... 55
2.3 Ordered Logistic Regression: Effect of Treatments on the Subjects’ Positive
Opinion About the Company That Took a Progressive Stance ................................... 62

2.4 Conservative Subjects: Difference in Means Test for Boycotting Follower and
Pioneer Treatment ........................................................................................................ 62
2.5 Liberal Subjects: Difference in Means Test for Buycotting Follower and Pioneer
Treatment ..................................................................................................................... 62
2.6 Liberal Subjects: Difference in Means Test for Buycotting Substantive and
Symbolic Treatment ..................................................................................................... 64
2.7 Conservative Subjects: Difference in Means Test for Boycotting Substantive
and Symbolic Treatment .............................................................................................. 64
2.8 Conservative Subjects: Difference in Means for Boycotting Responses Per
Treatments ................................................................................................................... 66
2.9 Liberal Subjects: Difference in Means for Buycotting Responses Per Treatment
Group ........................................................................................................................... 66
3.1 Acceptance and Response Rate by Treatment Group ................................................. 85
3.2 Acceptance and Response Rate by Treatment Group and Legislator's Committee .... 86
3.3 OLS Response by Treatment ....................................................................................... 89
3.4 OLS Results Predicting Legislative Acceptance to Interest Group Request ............... 89

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List of Figures

1.1 How the Different Political Capabilities Affect CPA ............................................... 19
1.2 How the Combination of the Different Political Capabilities Affects CPA ............. 20
1.3 How Market-Sensing and Customer-Linking Affect the Different Political
Capabilities. ............................................................................................................. 33
2.1 Mean Boycott and Buycott Response, Based on Subject’s Ideology ....................... 60
2.2 Mean Boycotting and Boycotting for Type of CSA Role: Follower and Pioneer
Treatments ................................................................................................................. 62
2.3 Mean Boycotting and Boycotting for Type of CSA Action: Symbolic and
Substantive Treatment .............................................................................................. 64
3.1 Meeting Request Sent to Spanish Legislators by Treatment Groups ....................... 83

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Abstract

The interaction between business interests, political elites, and civil society is a puzzle
that has produced some of the most prolific research in political science. This dissertation looks
that the relationship between these actors by focusing on the different angles of this triad.
Namely, it explores (1) the business interest – political elites’ relationship through a theoretical
argument on how firms can leverage their market capabilities to secure and increase their
political capabilities, (2) the business interest - civil society relationship through a survey
experiment to test how firms can strategically engage in sociopolitical corporate activism to
increase their market power, and (3) civil society – political elites’ relationship through a field
experiment on the conditions under which public interest groups have greater initial access to
legislators compared to business interest groups. The findings of this dissertation highlight the
central role of political ideology and sociopolitical interests in shaping the relationship between
social, political and business actors.

1
Introduction

The current project builds on the research on the interaction between business interests,
political elites, and civil society by looking at different sides of this triad. On the business
interest – political elites’ side of the triangle, chapter one explores how firms can gain political
power by leveraging their market power. On the business interest - civil society side of the
triangle, chapter two explores how sociopolitical debates unrelated to the firm’s core business
activity can be leveraged to strategically engage citizens as loyal customers. Lastly, on the civil
society – political elites’ side of the triangle, chapter three empirically tests the conditions under
which legislators decide to grant greater initial access to public interest groups compared to
private interest groups.
Focusing on the interaction between business interests – political elites, it is important
to highlight that the policy environment is a non-market domain with the power to
systematically impact the firms’ market competition and firm value. Therefore, companies have
the pressing need to develop political capabilities, defined as the firm’s ability to satisfy its
political goals by assessing and managing the policy environment to help sustain its competitive
advantage. However, the entry barriers of the political sphere make the implementation of
corporate political activities (CPA) a costly pursuit. How can firms attain a position of political
influence in face of their resource constraints?
Drawing on the resource-based view (RBV) and in-depth analysis of political and
market capabilities, I argue firms can increase the cost-effectiveness of developing political
capabilities through the integration of market-related resources, processes, and capabilities
towards the satisfaction of political goals. The underlying complementary between market and

2
political capabilities offers a unique way for firms to attain and sustain competitive advantage
in the long term. This chapter offers a novel analysis of a taxonomy of political capabilities and
their impact on the cost-effectiveness of CPA, and a framework on how to market capabilities,
including market-sensing and customer-linking capabilities, enable political skills in
stakeholder identification, knowledge acquisition, and stakeholder communication and
engagement.
Looking at how business interest interacts with civil society, in chapter two I explore
the novel phenomenon of corporate sociopolitical activism (CSA). Through CSA, private
companies are increasingly taking public stands on value-based socio-political issues largely
unrelated to their core business activity, such as environmental, gender, racial, or sexual rights,
to name a few. An example is a legal brief against President’s Trump travel ban for Muslims in
2017 signed by 100 companies. Similarly, a heterogeneous group of 200 companies endorsed
the 2018 Business Statement for Transgender Equality to protest discrimination against
transgender rights. Research on business-government relations views the involvement of
business in politics as a rent-seeking activity to secure competitive advantage, given the
political powers regulate the markets in which firms operate. However, CSA challenges the
existing explanations for why businesses seek influence in the political sphere. By engaging
with issues largely unrelated to their business activity, companies are not directly defending
their interests, but the preferences and values of specific constituents.
CSA engenders polarized affective evaluations towards the firm, where co-partisans see
the firm in a positive light, but supporters of the opposing party increase their desire for social
distance from, and discrimination against, those that do not share the same ideology. Civil
society is mobilized by CSA and expresses their support or disagreement with these brands

3
through the purchase behavior of consumers. I argue that the forms of actions undertaken by
firms to demonstrate their CSA critically shape consumers’ boycotting and buycotting
behavior, revealing an asymmetry in the way consumers respond to CSA that benefits firms
that take liberal stances. Consumers are more likely to boycott ideologically misaligned firms
that assume a pioneering role in promoting CSA than a follower role, while ideologically
aligned consumers consistently choose to buycott, regardless of the type of actions the firms
take. I implement a survey experiment on a large, nationally representative pool of United State
citizens. This study informs firms of appropriate strategies for engaging in CSA.
Lastly, chapter three looks at the civil society – political elites’ side of the triad by
exploring the initial access of interest groups to political elites. With a growing interest group
population across European countries, organizations are increasingly competing for first-time
access to policymakers. While research points to a potential interest group representation bias
that favors private economic groups, no study has provided a causally identified estimate on the
effect of an organization’s type of interest on achieving initial political access. This chapter
argues that the social desirability and positive reputation of nonprofit public interest groups
provide an incentive for legislators to grant greater access to these groups, compared to private
economic interests. Two studies explore how representatives grant initial political access: a
lobbying field experiment by partnering with an NGO network and a business group, and a
novel survey with legislators in Spain. Results show that, though legislators receive a similar
proportion of meeting requests across interest groups, the public interest organization is
systematically more successful in scheduling first-time meetings.
The dissertation concludes with a final discussion on the learnings of these research
projects on the interaction between business interests, political elites, and civil society.

4
Ultimately, it highlights novel dimensions of the power dynamics between these actors by
focusing on the market to political capabilities, the effect of corporate activism, and first-time
access of interest groups to the lobbying process. It discusses the opportunity to explore how
political values and economic interests act as complements or substitutes in the decision-
making of different business, political and social actors. Lastly, it provides a blueprint for
companies to strategically select which forms of political engagement to increase their political
and institutional positioning, as they become more socially involved actors.

5
Chapter 1: A Resource-Based Perspective of Corporate Political
Capabilities: What Are They and Where Can They Come From?

“The ability to influence the political power increases with economic power,
[...] money is used to gain political power and political power is then used to
make more money.”
Dr. Luigi Zingales, 2017

1.1 Introduction

Research on business organizations recognizes that political actors such as legislators
and regulators shape the “rules of the game” of the firms’ primary markets and determine firms’
profitability (Baron, 2016; Bonardi, Hillman, & Keim, 2005; Holburn & Bergh, 2008; Shaffer,
1995). Furthermore, given public and private interests are greatly interdependent (Mahoney,
McGahan, & Pitelis, 2009), firms have the incentive to develop connections with their political
stakeholders. As a result, companies implement political tactics, such as corporate political
activities (CPA), to influence the policy-making process toward their competitive advantage
(Henisz & Zelner, 2012; Hillman & Hitt, 1999; Keim,1981). However, the costly entry barriers
to competing in the regulatory arena deter many firms from engaging in CPA, leaving them at
a position competitive disadvantage compared to the larger firms, which are more politically
active (Hansen & Mitchell, 2000; Meznar & Nigh, 1995; Schuler, 1996). Furthermore, even
when firms do pursue CPA, the level of success of their implementation tends to vary
significantly (e.g., Hadani & Schuler, 2013). Some attribute the variation to differences in

6
firms’ political capabilities, that is, the firm’s ability to satisfy its political goals by assessing
and managing the risks of the policy environment (Holburn & Zelner, 2010).
Although researchers commonly agree that political capabilities are critical to
determining the success of CPA which, in turn, increases firm value, we still have limited
knowledge of specifically what constitutes these political capabilities, and the specific
mechanisms that enable firms to build them. If the primary purpose of a capability is to enhance
the productivity of the resources that the firm possesses (Barry, 1991; Makadok, 2001), then
we should start by analyzing the potential political value of the assets that are already owned
by the firm. Recent developments in strategic management theory point toward how various
capabilities that a firm develops and demonstrates in markets (Barney, 1986, 1991; Peteraf,
1993; Porter, 1980,1985) may enable the firm to develop political capabilities (Henisz & Delios,
2002; Holburn & Zelner, 2010) in assisting the firm to attain competitive advantage (Jia &
Mayer, 2016; Li, Peng & Macaulay, 2013). Despite the potential appeal of this approach, the
connection between market and political capabilities remains underdeveloped, particularly
regarding CPA research (Mellahi, Frynas, & Siegel, 2016). How can organizations effectively
develop political capabilities by exploiting their market capabilities? Answers to this question
will enable firms to explore the most cost-effective ways to develop political capabilities.
I argue that market-based capabilities positively influence how firms develop their
political capabilities via two mechanisms: by increasing the cost-effectiveness of engaging in
CPA and by capturing the value of firm-level specific competencies. First, market-based
capabilities increase the cost-effectiveness of CPA engagement in three ways. They lower the
opportunity cost of implementing different CPA (by providing more resources towards specific
CPA implementation and generating the possibility of implementing preemptive tactics); they

7
reduce the time of CPA implementation within the policy-making process, and they increase
the influence capacity of the CPA over the policy-makers decisions. Second, corporate political
capabilities can only lead to a sustainable competitive advantage if they are supported by firm-
level specific competencies (Barney, 1991; Mahoney & Pandian, 1992; Rugman & Verbeje,
2002). By integrating the unique configuration of market-related resources and processes into
its political strategy, the firm accelerates, extends, and establishes its sustained competitive
advantage in both the market and policy environment.
Specifically, the theoretical framework I developed to illustrate these mechanisms and
how they function consists of the following key components. First, I draw on the CPA literature
and relevant research in political science to provide a novel taxonomy of corporate political
capabilities, along with predictions over their effect on the CPA implementation. The
components of political capabilities consist of (1) the political sensing capability, which
facilitates the identification of regulatory/legislative risks and opportunities; (2) the political
access capability, which facilitates the connection with key political stakeholders; and (3) the
political exchange capability, which facilitates the provision of relevant political goods in
exchange for the political stakeholders’ support of the firm’s interests. Each of these political
capabilities enables the firm to carry out certain activities that shape how firms design and
implement their CPA.
Second, I develop the theory on how two capabilities, developed by participating in
market competition, enable the firm’s skills required to build the political capabilities introduced
above. I focus on the firm’s market-sensing and customer-linking capabilities and develop an
in-depth analysis of how they enable firms to better engage in the processes of stakeholder
identification, knowledge acquisition, and stakeholder communication and engagement. These

8
processes positively impact the firm’s responsiveness to changes in the policy environment, the
firm’s ability to connect with its political stakeholders, and the firm’s ability to influence
specific legislation.
This chapter makes the following contribution to management scholars and practitioners
interested in how firms sustain competitive advantage through their CPA. First, this study
engages with, and further develops, an emerging body of literature that highlights that firm’s
market capabilities can influence its decision to undertake political actions, as well as the
effectiveness of their execution (Bonardi, 2006; Jia & Mayer, 2016). Although this literature
offers a general idea that political and market capabilities may be related, it falls short of
identifying specific theoretical mechanisms and providing a clear analysis of how these
connections occur. This chapter develops a novel conceptual framework that articulates the
mechanisms for the integration of market and political capabilities in the firm’s pursuit to
sustain competitive advantage.
Second, the theoretical framework is developed primarily based on the resource-based
view (RBV) (Barney, 1991; Mahoney & Pandian, 1992; Peteraf, 1993; Wernerfelt, 1984), and
it demonstrates how RBV can generate new insights about firm strategy in the non-market arena
in two ways. The chapter provides a detailed in-depth analysis of what constitutes political
capabilities, an appealing notion that has been quickly adopted by the CPA literature (e.g.,
Holburn & Zelner, 2019; Jia and Mayer, 2016) but remains under-developed. Moreover, the
theoretical mechanisms that illustrate the overlapping skills in the market and political activities
better help researchers of CPA to understand where political capabilities come from and how
they may be developed.

9
Finally, the theoretical framework demonstrates the complementarity between firms’
market and political activities. According to the RBV, firms’ competitive advantage in markets
stems from their ability to possess and transform valuable, rare, inimitable, and non-
substitutable resources into capabilities (Barney, 1991). Firms that lack such resources or
capabilities face a cost disadvantage compared to those competitors that already possess them.
However, if we conceptualize political and market activities as competing for limited internal
resources within the firm (Bonardi, 2008), then firms may be less willing or able to engage in
the policy environment. By demonstrating how market-related capabilities can be integrated
with the activities that aim to achieve political goals, I develop a series of cost-effective
mechanisms for firms to develop political capabilities while capturing the value of readily
available market-related resources and processes. As a result, the chapter offers an approach
that integrates the influential role of market-oriented capabilities towards the firm’s ability to
mobilize political resources to successfully implement CPA.
The first section will examine the taxonomy of the foundational types of political
capabilities. The analysis will focus on the resources and processes in developing political
sensing, political access, and political exchange capabilities. The second section will develop
the mechanisms through which market-related capabilities allow for the development of
political capabilities. The focus is set on market-sensing and customer-linking capabilities, and
their underlying processes of knowledge acquisition, stakeholder identification, and stakeholder
communication and engagement. The conclusion provides a discussion of the managerial
implications of this framework along with suggestions for future research.

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1.2 What are Political Capabilities? A Taxonomy

Political capabilities entail the firm's ability to utilize its resources to both assess the
risks and opportunities of the policy environment and to implement strategic political actions
to shape the regulatory environment to the firm’s advantage. (Amit & Schoemaker, 1993;
Bonardi et al 2006; Holburn & Zelner, 2010; Lawton, McGuire, & Rajwani, 2013). A politically
capable firm will successfully carry out the following three key processes in the policy sphere:
anticipate regulatory change by obtaining and interpreting political information; target and
connect with relevant political stakeholders that hold a decision-making capacity over the
firm’s political environment, and obtain the political stakeholders’ support in line with the
firms’ interests by exchanging valued political goods (Hillman & Hitt, 1999; Holburn &
Vanden Bergh, 2002; Schuler, Rehbein, & Cramer, 2002).
These processes constitute the three types of a firm’s political capabilities, namely
political sensing capability, political access capability, and political exchange capability. As we
will see, such distinct capabilities guarantee the cost-effectiveness of the overall political
strategy by influencing the different stages of the CPA implementation. In developing these
political capabilities, the firm optimizes the commonalities and complementarities between the
different political resources it possesses. Following the resource-based view, firms must acquire
heterogeneous and immobile resources that differ from their competitors (Barney 1986, 1991;
Rumelt, 1984). More specifically, the resources should be rare, inimitable, and non-
substitutable into capabilities, what is known as the VRIN framework (Barney, 1991). In the
case of political capabilities, the firm can acquire and combine organizational resources (i.e.,
in-house lobbyist), expertise resources (i.e., exclusive information), relational resources (i.e.,

11
political connections), reputation resources (i.e., positive stakeholder perception), financial
resources (i.e., campaign contributions) and constituency resources (i.e., the possibility to
mobilize its social stakeholders) (Baron, 1995; Dahan, 2005; Epstein, 1969; Lord, 2003).
Some of the firm’s political resources are arguably more valuable than others. For
instance, relational resources are difficult for rivals to replicate, due to the time and resource
integration involved in developing a relationship (Srivastava, Fahey, & Christensen, 1998).
These qualities make political relational resources potentially more VRIN than organizational
resources like an in-house lobbyist, who can be recruited by the competition. Nonetheless, a
stand-alone resource cannot sustain a competitive advantage in the long term, because firms
need to gradually integrate and mobilize their resources, and acquire experience implementing
political tactics, to develop their political capabilities (Holburn & Zelner, 2010; Jia and Mayer,
2016). Fortunately, each type of political capability offers the opportunity to accumulate
additional or novel resources for the firm. For example, by developing political access
capabilities the firm not only accumulates relational resources but also generates expertise
resources about the policy-making process that serves to improve its political sensing
capabilities.
The increasing accumulation of political resources, and their complementarity for each
of the types of political capabilities, implies the firm’s strengths in one area have a potentially
positive impact on its ability to further develop the rest of its currently weaker capabilities.
Therefore, the cost of engaging in CPA will be gradually reduced, because the frequency of
engaging in such behavior will improve the performance and effectiveness of future strategies
(Frynas, Mellahi, & Pigman, 2006; Bonardi, Holburn, & Vanden Bergh, 2006). In this sense,
the connection between political sensing capability, political access capability, and political

12
exchange capability forms a mutually reinforcing process resulting in the firm’s overall political
capability level.
The firm’s strength in each of the three types of political capabilities will affect the
following aspects of the political strategy: the style of CPA, such as preemptive or reactive
towards the policy-making process; the linearity of the CPA, such as having direct or indirect
access to political stakeholders; and the effectiveness of the CPA, such as a strong or a week
influence over the policy. These, in turn, will directly affect the cost opportunity of engaging in
CPA, since its cost-effectiveness decreases with the advancement of the policy-making process.
For instance, in the final stages of the policy-making process, the legislators will have defined
an opinion over whose interests they support. If this opinion is not in line with the firm’s
preference, the chances of success decrease, a higher volume of resources are needed to
counteract the unwanted policy advancement, and thus the cost of CPA implementation
increases.
However, as the firm can develop the different dimensions of its political capabilities, the
effectiveness of the CPA will change. Next, I will provide a detailed analysis in the following
subsections about how, (1) through political sensing capabilities, the firm will be able to pursue
CPA preemptively, rather than reactively; (2) through political access capabilities, the CPA
implementation will be more linear and direct; and (3) through political exchange capabilities,
the influence over the public policy will be stronger. I will then analyze why, with higher levels
of each political capability, the firm can (1) anticipate regulatory risks and opportunity
windows, (2) connect with its relevant political stakeholders, and (3) exchange valued political
goods, compared to its competitors.

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1.2.1 Political Sensing Capability
Political sensing capability refers to the organization’s awareness of the potential effects
that the risks and opportunities of the policy environment have on the firm’s competitive
advantage. Most of the political-strategy-related decisions are shaped by the organization’s risk
perception of the policy environment. Though there exist various forms of political risk, such
as civil unrest or government instability (Aliber, 1975; López & Vidal, 2010), this chapter refers
to them as the potential negative effects that regulatory changes could have on the firm’s
activity. However, political sensing capability also accounts for the firm’s awareness of
potential opportunities to attain competitive advantage through regulatory influence. I conclude
that political sensing capability affects the cost-opportunity of engaging in CPA by anticipating
policy changes and by facilitating the implementation of preemptive CPA.
Political sensing capability is attained through a conscious organizational effort to
collect, analyze, and convert information into competitive political intelligence. Such a process
requires attending to political environment cues, interpreting their significance, and predicting
their long-term implications for the organization. It can be accomplished as firms mobilize and
develop experience in managing organizational resources (i.e., in-house lobbyists), expertise
resources (i.e., industry-level knowledge), and relational resources (i.e., established
relationships with legislators).
The firm’s ability to acquire and process relevant information about its political
environment will affect its ability to implement CPA before its competitors, thus leading to
policy change (preemptive strategy) rather than responding to it (reactive strategy) (Hillman
and Hitt, 1999; King & Lenox, 2000; Oliver & Holzinger, 2008). Preemptive strategies involve
the firm pursuing CPA to lead (or gatekeeping) regulatory change, even before policymakers

14
take any concrete actions. Preemptive strategies are characterized by their early implementation
in the policy-making process, giving the firm a “first-mover” advantage in the legislative sphere.
An example of a preemptive strategy would be the approval of self-regulating protocols (e.g.,
King & Lenox, 2000), such as the production of goods without the potentially toxic BPA plastic,
and then using these measures in lobbying tactics so that the “MADE SAFE” seal becomes a new
mandatory requirement across the industry.
By contrast, reactive political strategies as that CPA directed towards influencing or
stopping the development of a policy that is already underway. Thus, a reactive political
strategy is initiated in response to the policymaker’s actions. Reactive strategies are
characterized by their later implementation in the policy-making process. An example of a
reactive strategy would be lobbying to modify the content of a clause within a legislative
proposal endorsed by most policymakers.
In conclusion, political sensing capabilities affect the cost-opportunity of engaging in
CPA primarily by allowing the firm to anticipate policy changes and by facilitating the firm’s
decision-making process of what type of CPA should the firm implemented. This is
summarized as follows:
Proposition 1. Firms with stronger political sensing capabilities are more likely to
implement preemptive political strategies before competitors can mobilize. That is, CPA will be
implemented in the early stages of policymaking for firms with stronger political sensing
capabilities.

15
1.2.2 Political Access Capability
Once a firm has identified a regulatory risk or opportunity, it needs to target and connect
with the relevant political decision-making stakeholders for its business environment to
persuade them to defend the organization’s interest. Political access capability refers to the
firm’s ability to identify potentially alliable political stakeholders and to successfully establish
a relationship with them. The firms that wish to influence the policy process will encounter the
challenge of having narrow access to public policy-makers due to the competition between
different interest groups for the same legislators’ attention (Baumgartner, Berry, Hojnacki,
Kimball, & Leech, 2009; Baumgartner & Jones, 2005; Gray & Lowery, 1997). However,
political access capability allows overcoming these access barriers by facilitating linear or direct
access to political stakeholders, which provides the firm a "first-mover" advantage.
Direct political access entails the firm can contact its political stakeholders whenever it
needs to. Such access accelerates the CPA implementation and lowers its cost for tactics such
as lobbying. Firms achieve direct access through the mobilization or combination of
organizational political resources, such as in-house lobbyists, and relational resources, such as
previously established political relationships. Alternatively, the firm can gain indirect political
access by signaling to its political stakeholders that it possesses valuable resources, though this
mechanism means the CPA will take longer to implement. Firms can gain indirect political
access through their expert resources, reputation resources, constituency resources, or financial
resources.
Expertise resources refer to the firm’s possession of the type of information that the
legislator needs to succeed in the policy-making process. Given their time and resource
constraints, legislators, value the expert input of organizations that can assist them in

16
strengthening their policy positions (Drutman, 2015; Grossman & Helpman, 2001; Hall &
Deardorff, 2006). Reputation resources refer to the perception that political stakeholders have
about the firm, where a positive sociopolitical reputation increases the likelihood of gaining
political access (Wang & Qian, 2011; Werner, 2015). Financial resources, such as campaign
contributions, provide the firm with greater access to legislators compared to the rest of the
organizations that do not donate (Kalla & Brookman, 2015; Stratmann, 1991). Finally,
constituency resources refer to the firm’s capacity to mobilize the politician’s constituents in
defense of the organization’s interest (Walker, 2014).
Note that, whichever the resources are mobilized to gain political access, once a
connection has been established the firm must sustain its relationship with its political
stakeholders over time. Expanding and sustaining the political network serves a double purpose;
to secure the relational resources that will allow for future direct political access, and to acquire
exclusive political information that can be for the development of political sensing capabilities.
As a result, political access capability affects the cost-opportunity of engaging CPA
based on the firm’s relative facility to access the political network compared to its competitors,
that is, its direct or indirect access to its political stakeholders. I, therefore, summarize the
conclusion in Proposition 2:
Proposition 2. Firms with stronger political access capabilities will have greater access
to their political stakeholders compared to their competitors. That is, the implementation of
CPA will be faster for firms with political access capabilities.

17
1.2.3 Political Exchange Capability
Political exchange capability is the firm’s ability to identify and provide desirable goods
to its political stakeholders in exchange for supporting the firm’s interests. Understanding these
mutually beneficial dynamics is key to explaining the interdependence between private and
public interests (Mahoney et al, 2009). Political capabilities assume that the political
environment operates as a market (Bonardi et al., 2005; Hillman & Hitt, 1999; Mahoney, 2004;
Mahoney et al, 2009), where policy outcomes are the product of the interactions between the
different demand and supply side actors. The demand side consists of firms, non-profit
organizations, trade unions, customer associations, and interest groups that petition elected
representatives (Figueiredo & Richter, 2014). The supply side is formed by those that develop
and implement policies, such as government agencies or legislators. In return for having
legislation aligned with a demand demand-side, the political market exchanges three types of
goods: money, information, and votes. These correspond, in return, to the three major forms of
CPA, campaign contributions, lobbying, and constituency building, respectively (Hillman &
Hitt, 1999).
The primary incentive that explains the behavior of office-motivated policymakers is
reelection. Money, information, and votes are desirable political goods because they increase
the legislator’s chances of reelection. First, money is central to politics since representatives
depend on financial resources to support their campaigns when running for office (Green &
Gerber, 2008). Second, given their time and resource constraints, politicians prioritize attending
groups that can provide expert information that will help them succeed in the policy-making
process (Drutman, 2015; Grossman & Helpman, 2001; Hall & Deardorff, 2006; Richter,
Samphantharak, & Timmons, 2009). Third, votes represent the aggregate level of constituent

18
preferences and support for the legislator’s policy decisions. Indirect information about the
public sentiment (Hansen, 1991; Jacobson, 2004) or direct exposure to constituent
preferences, such as through public petitions or mailing to representatives (Baysinge, Keim &
Zeithaml, 1985; Walker, 2014) indicates the legislator the type of policy positions that will help
to achieve reelection.
Political exchange capabilities mean that a firm can successfully mobilize its resources
to trade them as valued political goods in exchange for its political stakeholders’ support. By
providing the legislators with their preferred political goods at the different stages of the policy-
process, the influence capacity of the firm will be greater compared to competitors. By contrast,
mobilizing less valued resources yields a weaker influence capacity, therefore the effectiveness
of the overall CPA will be lower. The value of a firm’s organizational, reputation, financial,
and constituency resources as political goods depends on factors such as institutional incentives,
issue salience, constituents’ awareness of the policy effects, or even the electoral term for the
representative (Bonardi et al., 2005; Kollman, 1998; Feldman & Jondrow, 1984). For example,
mobilizing financial or constituency resources is not effective when influencing regulators in
government agencies, since their office position does depend on reelection.
Firms can increase their knowledge about what type of political goods legislators’ value
as a product of their political access capabilities and political sensing capabilities. As the firm
establishes its political connections and acquires intelligence over the policy-making process,
it will anticipate which political good will be the most elective to achieve influence, depending
on the policy and legislator-level characteristics. The relevance of political exchange
capabilities for the firm's competitive advantage is summarized as follows:

19
Proposition 3. Firms with stronger political exchange capabilities will have a greater
influence over the policy-making process by identifying and providing valued political goods
to political- stakeholders, compared to their competitors. That is, the effectiveness of the
CPA will be greater for firms with political exchange capabilities.
Figure 1.1 illustrates the types of political capabilities and their overall effect on the
different stages of the CPA implementation, as captured by Propositions 1-3. Figure 1.2
illustrates how the combination of the different political capabilities affects the overall CPA
cost-effectiveness outcome. Although arguably this framework does not provide an exhaustive
analysis of all the categories of political capabilities, by priming parsimony I focus on three
foundational capabilities, without which the firm is unenabled to achieve legislative influence
to satisfy its political goals.

Figure 1.1. How the Different Political Capabilities Affect CPA.

20

1.3 From Market Capabilities to Political Capabilities
The initial cost curve for obtaining political resources, along with the experience curve
for developing political capabilities, can be very steep at first. This puts the firm in a
disadvantaged position compared to those rivals that already possess the necessary resources
and skills to satisfy their political goals. The problem is aggravated as political and market
activities compete for limited internal resources within the firm (Bonardi, 2008), which means
that the organization may have a limited capacity to pursue CPA, even when these would be
crucial to protecting the firm’s market value, such as occurs in the context of an industry de-
regulation.
Nonetheless, these limitations provide an incentive to transfer the value of the firm’s
readily available resources and processes from its market-related capabilities into the
Figure 1.2. How the Combination of the Different Political Capabilities Affects CPA.

21
development of political capabilities. There are three advantages to the integration of market-
related capabilities towards the development of political capabilities. First, it reduces the cost
of acquiring and using political resources. Firms tend to postpone or avoid altogether the
implementation of CPA given the significant entry barriers to engaging with the policy sphere.
However, by transferring the ample selection of readily available market-related resources and
processes, firms can avoid the cost of acquiring exogenous political resources. Second, it
optimizes the firm’s ability to capture the value of its market-related resources and processes
more fully. By app marketing capabilities toward the satisfaction of political goals, the firm can
extend and optimize its utility. Third, it strengthens the firm’s overall ability to attain and
sustain competitive advantage by developing political capabilities unique to the firm. Market
capabilities are developed through accumulated market resources - valuable, rare, inimitable,
and non-substitutable (VRIN)-, knowledge and skills that are firm-specific and hard to replicate
by competitors. In the same way market capabilities can only lead to a sustainable competitive
advantage if it is supported by unique firm-level VRIN (Barney, 1991; Rugman & Verbeje,
2002), leveraging its readily available VRIN resources to develop its political capabilities is a
strategic move that strengthens the firm’s sustained competitive advantage.
While numerous market capabilities enable firms to succeed in market competition (e.g.,
Barney, 1991; Song, Benedetto, & Nason, 2007), I focus on two of the key capabilities of
market-oriented firms, these being the market-sensing capabilities and customer-linking
capabilities (Day, 1994). As I will explain in subsequent sections, these are the most relevant
market capabilities for the development of political capabilities identified above. The market-
sensing capability is based on internal processes of stakeholder monitoring and knowledge
acquisition to forecast future market opportunities and threats. The customer-linking ability

22
focuses on stakeholder communication and engagement skills to build relationships with
customers. Next, I will provide the theoretical argument that these processes facilitate the
acquisition of political resources, primarily expertise, relational, reputational, and constituency
resources.

1.3.1 Market-Sensing Capability
The market-sensing capability refers to an organization’s ability to generate market
intelligence to forecast market developments, such as present and future needs of customers or
competitors' moves, and prepare the organization's responsiveness to such market changes
(Day, 1994; Foley & Fahy, 2004; Jaworski & Kohli, 1993). This capability is developed by
accurately spotting opportunities and threats through continuous monitoring of the firm’s
market environment (Morgan, Vorhies, & Manson, 2009). For the firm to develop
comprehensive market forecasts, its monitoring should involve collecting data not only about
its customer's and competitors’ behavior but also about external market factors, including
government regulations (Kohli & Jaworski, 1990). Therefore, market-sensing capabilities rely
on the internal process of knowledge acquisition about the firm’s general environment, as well
as on the identification and monitoring of specific stakeholders’ behavior. These processes help
the firm to transform their data into valuable expertise resources necessary to comprehend,
access, and influence the policy-sphere.
The firm’s responsiveness to its environment starts with the identification and
monitoring of macro-level dynamics, along with the actions of its stakeholders. A stakeholder
is any person or group with the potential to affect the achievement of the organization’s
objectives (Freeman, 1984; Mahoney, 2012). These can be classified as primary stakeholders,

23
those who have formal relationships and economic impact on the firm (i.e., customers), and
secondary stakeholders, those who can affect the organization even though they are not directly
engaged in its economic activity (i.e., NGOs). How firms manage the relationship with their
stakeholders is sustaining their competitive advantage (Choi & Wang, 2009). Through market-
sensing capabilities, firms learn about their stakeholders’ preferences and behavior, allowing for
the early identification of patterns that predict relevant environmental changes. As a result, the
firm’s market-sensing awareness will increase the firm’s preemptive responsiveness to change.
This knowledge is key to ensuring the firm’s survival since its competitive advantage can be
compromised if it only adopts reactive strategies to manage its environment when competitors
are assuming proactive roles (Garrod, 1997). I argue that a stronger market-sensing capability
will enable firms to develop all three forms of political capabilities more effectively.
The market-sensing intelligence about the firm’s larger environment and its primary and
secondary stakeholders helps to anticipate potential regulatory risks and opportunity windows,
which is the core function of political sensing capabilities. The complementarity of market
sensing and political sensing capabilities explains why firms implement corporate social
responsibility programs or develop self-regulating practices (King & Lenox, 2000). Therefore,
market-sensing, in assisting in the development of political sensing capabilities, helps the firm
to implement preemptive CPA before the rest of the competitors can mobilize.
An illustrative case is how the different companies dealt with the de-regulation of the
European airline industry in the 90s. Through its market-sensing capability, the non-state-
owned Swedish SAS developed an early forecast of the implications of the forthcoming
regulation for its activity. As a result of such anticipation, it implemented lobbying practices at
the earlier stages of the policy-making process, as well as structural changes within its

24
government relations department to adapt to the chains of the policy environment (Lawton et
al., 2013). By contrast, state owned-firms, which lacked an incentive to develop market-sensing
capabilities, started to implement their CPA at later stages of the policy process and did not take
the structural changes necessary to adapt to the forthcoming policy change.
Therefore, I argue that firms’ capabilities to sense the market enable them to develop
stronger political sensing capabilities, which is captured by Proposition 4a:
Proposition 4a. Market-sensing capabilities have a positive impact on the firm’s ability
to build political sensing capabilities by identifying broader policy risks and opportunities
before other competitors can mobilize.
Moreover, because Proposition 1 establishes that stronger political sensing capabilities
enable firms to adopt preemptive CPA, I conclude that stronger market sensing capabilities of
the firm, through their positive effect on developing political sensing capabilities, should also
enable firms to adopt preemptive CPA.
Proposition 4b. Firms with strong market-sensing capabilities will engage in more
preemptive CPA compared to their competitors.
The political access capability can also be built leveraging the market-sensing’s highly
specialized knowledge about the larger market environment and particular stakeholders’
behavior. Market-sensing signals to legislators the firm possess specialized knowledge,
therefore it helps to gain indirect political access in those instances where the firm lacks political
relational resources.
Recall the main motivation behind legislators’ actions is to increase their chances of re-
election, which first requires having reliable information about the specific constituent
preferences. In addition, legislators require exclusive expert information that will help to

25
strengthen their legislative proposals as these moves along the policy-making process.
Organizations with strong market-sensing capabilities can gain indirect political access by
signaling to legislators that they handle exclusive information about the stakeholders they care
about, such as customer/constituent preferences, as well as relevant expert knowledge about
industry-level issues, and market forecast, supply chain, etc. In other words, the market-sensing
information is a hook that catches the legislator’s attention and interest, and therefore it helps
to gain political access. An example of this is the case of Florida’s 1990s soft-drink tax. In the
wake of a new legislative proposal, Florida’s soft-drink companies gathered information about
their consumer preferences through a statewide poll to reveal to legislators that 62% of them
disliked the idea of a tax on soft drinks (Rosenthal, 2000).
Therefore, I argue that market-sensing information can be leveraged to gain political
access, which is captured by Proposition 5a.
Proposition 5a. Market-sensing capabilities have a positive impact on the firm’s
political access capabilities by signaling to political stakeholders the firm’s higher expertise
resources compared to competitors.
The broad scope of the information acquired through market-sensing capabilities is
useful not only to connect with representatives related to an imminent policy that the firm
wishes to influence (react strategy) but to representatives related to the implementation of
preemptive strategies, even if these are part of committees unrelated to the firm’s business
activity. For instance, GlaxoSmithKline, while lobbying for subsidies to develop products to
treat the Zika virus in 2016, it needed to access not only the Health Committee, directly related
to its sector but also legislators in the Appropriations Committee, indirectly related to its sector

26
since it is responsible for regulating the US government’s expenditure. I summarize this
conclusion in proposition 5b.
Proposition 5b. Firms with market-sensing capabilities will be able to gain greater
access to a larger number of political stakeholders compared to their competitors.
The firm’s market-sensing capability can also assist the firm in developing its political
exchange capabilities. Firms must be able to offer something valued to public officials in
exchange for receiving favorable policies (Getz, 2002), such as money, information, or votes.
Note that the firm’s expert information provision is a form of legislative subsidy (Hall and
Deardorff, 2006), making policymakers rely heavily on the organization’s issue knowledge to
make decisions. This close relationship provides an opportunity window for the firm to facilitate
the type of information that will shape the policy toward supporting the firm’s interest. Such a
position of influence is particularly the case when the legislation involves a high technical
knowledge of the issue. As a result, the firm that holds this type of expertise will implement
strongly influential information exchange strategies.
For example, chemical companies have the incentive to develop strong market-sensing
capabilities, given their active research, new product development, patents, etc. In 2018, the
American Chemistry Council was able to reverse a forthcoming ban on the use of the
environmental degreaser trichloroethylene (TCE) through its superior technical knowledge of
the substance and the forecast of the regulation’s impact on the industry sector. Another
example is the previously mentioned European 1990s airline de-regulation, where the non-
state-owned Swedish SAS admitted to having an influential relationship with the legislators
since it possessed the type of expertise they needed (Lawton et al., 2013).

27
I summarize the effect of the market-sensing capability on its political exchange
capabilities in the following way:
Proposition 6a. Market-sensing capabilities have a positive impact on the firm’s
political exchange capabilities by leveraging the disclosure of superior issue knowledge and
information in exchange for favorable policies.
In line with Proposition 3, which stated that political exchange capabilities enable
strongly influential political strategies, given that market-sensing capabilities increase the value
of the firm’s information provision to political stakeholders I conclude the following:
Proposition 6b. Firms with market-sensing capabilities will implement strongly
influential informational exchange compared to their competitors.

1.3.2 Customer-Linking Capability
The customer-linking capabilities enable firms to build and sustain strong customer
relationships, which increases the overall satisfaction and loyalty towards the firm (Rust,
Lemon, & Zeithaml, 2004; Hooley, Greenley, Cadogan, & Fahy, 2005). Firms with strong
customer-linking capabilities bring together multiple customer touchpoints, media, and
messages (Peltier, Schibrowsky, & Schultz 2002) to tailor how they communicate with
customers and in which forms (Kim, Shi, & Srinivasan, 2004). The target audience and their
preferred channels of communication will affect how the firm will implement experiences to
extend the time the stakeholder spends with the firm’s message (Nelson, Keum, & Yaros, 2004).
The activities involved in customer-linking capabilities, such as communications
channel management, consumer focus groups and events, technology, and market segmentation
(Piercy, 2016; Lin & Wang, 2015), are often considered by scholars as part of marketing

28
objectives (Hooley et al., 2005; Brodie, Hollebeek, Juric, & Ilic, 2011; Sprott, Czellar, &
Spangenberg, 2009). As a result, customers develop a loyal and enduring relationship with the
firm, even to the point they begin to define themselves in terms of the organization, what is
generally called the consumer-company identification (Bhattacharya & Sen, 2003; Mael &
Ashforth, 1992).
Customer-linking capabilities imply the firm has developed superior stakeholder
communication and engagement skills. These provide three key strengths for the firm. On one
hand, they improve the firm’s persuasive ability to shape how consumers, perceive and think
about the organization, its products, and its image. On the other hand, they foster the necessary
channels to contact existing and potential customers. Finally, they prompt customers to develop
strong, committed, and meaningful relationships with the company, to the point the organization
becomes a component of people's social identity (Ashforth & Mael, 1989).
I argue these communication and engagement skills serve not only market-oriented
goals but for the development of political capabilities. Specifically, they facilitate the
development of the firm’s access and exchange capabilities by acquiring and mobilizing
relational and constituency resources, and by enhancing the value of its expertise resources.
Firms with strong customer-linking capabilities can develop political access capabilities
through both their knowledge of attracting and retaining stakeholders’ interest and through their
comparatively greater support and positive reputation amongst their customers and allied
partners. First, firms with customer-linking capabilities can successfully attract and retain their
political stakeholder’s interest by deploying engagement tactics. These include launching
marketing campaigns, conducting market surveys, organizing corporate events such as awards
and plant/field showings, etc. Furthermore, since these tactics provide re-occurring points of

29
contact with the firm’s political stakeholders, they help to implement not only indirect political
access tactics but to increase and consolidate the firm’s political relational resources.
As an example, waste management companies continuously implement marketing
strategies to encourage citizens to recycle and to share amongst their networks the importance
of such habits. In this line, the Spanish Ecoembes launched in 2 a perception study integrated
into an interactive quiz amongst its political stakeholders. To incentivize participation, the
campaign was framed around the salient issue of climate change, and the survey completion
was rewarded with a book on the topic. Such a tactic increased the firm’s visibility amongst its
political stakeholders and facilitated further re-engagement actions, such as securing follow-up
meetings to present the results of the study. This strategy successfully increased and
strengthened the firm’s relational resources.
Second, customer-linking capabilities increase the firm’s positive reputation as customers
develop committed and meaningful relationships with the firm (Bhattacharya & Sen, 2003;
Schultz, Hatch & Larsen, 2000; Walsh, Mitchell, Jackson & Beatty, 2009). This reputation can
be leveraged as a political resource since politicians are more willing to grant access to firms
with higher sociopolitical reputations (Wang & Qian, 2011; Werner, 2015). Moreover, this
reputation also affects the firm’s ability to partner with other organizations in the social and
political arenas to increase the visibility of tactics such as advocacy campaigns. If a partnership
is established, it can help the firm to increase its relational resources (i.e., by being able to
access the partnering organization’s stakeholders’ network) and reputational resources (i.e., by
associating with organizations that support the firm’s activity). All these resources can be
leveraged toward the development of political access capabilities.

30
An example of this is The Body Shop, recognized as the first global cosmetics company
to position itself against animal testing. The Body Shop partnered with the NGO Cruelty-Free
International at the beginning of 1989 and it launched the "Ban Animal Testing" campaign to
pressure regulation in the UK. Eventually, this legislation became effective in November 1998,
immediately placing The Body Shop in a competitive advantage, since now the rest of the
industry competitors hard to restructure their product-related processes to comply with the new
legislation.
Because customer-linking capabilities serve to connect with the firm’s political
stakeholders by attracting and retaining their interest, I conclude the following:
Proposition 7a. Customer-linking capabilities have a positive impact on the firm’s
political access capabilities by providing superior communication opportunities and
engagement touchpoints with its political stakeholders, compared it its competitors.
Given Proposition 2 establishes that stronger political access capabilities enable firms
to contact legislators more quickly and directly, I conclude that stronger customer-linking
capabilities should also enable direct CPA implementation.
Proposition 7b. Firms with customer-linking capabilities will be able to implement CPA
more directly given their superior ability in acquiring and sustaining relational and
reputational resources, compared to their competitors.
Customer-linking capabilities have a positive impact on the firm’s exchange capabilities
by lowering the cost of implementing both constituencies building strategies and information
exchange strategies. Constituency building is the most complex form of CPA, given it is based
on influencing policymakers through the grassroots mobilization of customers, supply chain,
and employees, to name a few (Baysinger, Keim, & Zeithaml, 1985; Walker, 2014). Collective

31
action problems such as lack of communication channels or coordination issues (Olson, 1965)
explain why this strategy is too costly for many firms to implement. However, customer-linking
capabilities help firms to overcome these constraints through their communication and
engagement skills, and their close relationship with their customers. First, the communication
and engagement skills are useful to encourage the firm’s customer base to directly contact their
representatives to show they support the firm’s interests when facing a regulatory threat. This
feature is particularly relevant for technological firms, where the business model relies on
connecting customers through their platforms (i.e., Facebook).
The networked transportation company Uber provides a clear example. In handling the
regulatory setting in New York and Austin, Uber presented a new “view” of its app, designed
to target officials who had proposed vehicle caps and fingerprinting, respectively. When
customers opened the app, a pop-up message appeared providing a link to contact elected
representatives to express their opposition to the new regulations (Collier, Dubal, & Carter,
2018). This was possible only through the direct access Uber has to its consumers through its
app, a feature that competitors and the overall taxi industry lack.
Second, within the RBV framework, customer relationships constitute a valuable
intangible resource that is very difficult for rival firms to replicate, given the time and resource
integration it takes to develop such relationships (Srivastava et al., 1998). The uniquely close
relationship between the firm and its customers, a product of the customer-linking capabilities,
helps to overcome most of the collective action problems associated with the implementation
of a constituency-building political strategy, given customers are readily mobilized.
Anheuser-Busch, the manufacturer of Budweiser and Michelob, is an example of how
consumer-company identification (Bhattacharya & Sen, 2003) assists in the implementation of

32
grassroots mobilization, since, aside from its large customer base, it projects an image of
conviviality and friendship that adds power and credibility to the movement, which contrasts
with other rival industries, such as the wine sector (Rosenthal, 2000).
I conclude that customer-linking capabilities are beneficial for the firm’s political
exchange capabilities in the following way:
Proposition 8a. Customer-linking capabilities have a positive impact on the firm’s
political exchange capabilities by reducing the costs of implementing constituency-building
strategies. That is, firms with strong customer-linking capabilities can better engage and
mobilize their consumers to support the firm’s interest compared to competitors.
Second, customer-linking capabilities also facilitate the implementation of information
exchange strategies since “persuading a potential customer to buy a product is similar to
persuading a politician to support (or oppose) a particular policy” (Jia and Mayer, 2016:16). As
the firm can bridge the gap between what the marketer wants to say and what the consumer
needs to hear (Ashley & Tuten, 2014), it is improving its ability to persuade its stakeholder and
effectively communicate its message. These communication skills are determining in enhancing
the value of the firm’s expertise resources, which influences the legislator’s willingness to
support the firm’s policy position. This is particularly the case with legislations that involve
knowledge of highly technical issues, which are uncommon for representatives to be familiar
with (Hillman & Keim, 1995). Proposition 8b summarizes how the communication skills
developed through customer-linking capabilities help to develop political exchange
capabilities:
Proposition 8b. Customer-linking capabilities have a positive impact on the firm’s
political exchange capabilities by increasing the effectiveness of the persuasion capacity

33
information exchange strategies. That is, firms with strong customer-linking capabilities hold
higher persuasion levels than their competitors.
Finally, these dimensions of customer-linking capabilities – the communication and
engagement skills, along with the close customer relations- ultimately affect the strength and
effectiveness of the firm’s CPA influence on the legislator’s policy position. Proposition 3
stated that political exchange capabilities increased the firm’s influence on the policy. Since
customer-linking capabilities assist the firm in developing its political exchange capabilities I
therefore argue:
Proposition 8c. Firms with strong customer-linking capabilities will be able to increase the
strength and effectiveness of their influence on the political stakeholders’ support for the firm.

Figure 1.3. Illustration of How Market-Sensing and Customer-Linking Affect the Different
Political Capabilities.

34
1.4 Conclusion

Organizations develop political capabilities to utilize their resources to both assess the
risks and opportunities of the policy environment, and to implement strategic political actions,
such as corporate political activities (CPA) (Henisz & Zelner 2012; Hillman & Hitt, 1999;
Keim,1981), to shape the regulatory environment to their advantage (Amit & Schoemaker,
1993; Bonardi et al 2006; Holburn & Zelner, 2010; Lawton, McGuire, & Rajwani, 2013).
However, the initial cost of obtaining political resources and steep experience curve when
developing political capabilities deters many firms from engaging with their political
environment. Aware of this challenge, strategic management research has increasingly looked
at how firms can integrate market and political strategies (Baron, 1995, 1997, 2001) particularly
by linking the various capabilities that firms develop and demonstrate in markets (Barney 1986,
1991; Peteraf, 1993; Porter, 1980,1985) towards the development of political capabilities (Jia &
Mayer, 2016; Li, Peng, & Macaulay, 2013).
This chapter further develops this body of literature by outlining a taxonomy of the three
types of political capabilities, and by developing a framework through which firms can capture
the value of their market-related resources, process, and capabilities to implement cost-effective
CPA and, ultimately, develop each of the political capabilities. First, through political sensing
capabilities, the firm anticipates regulatory risks and opportunity windows, therefore it can
pursue preemptive CPA, rather than reactive; through political access capabilities, the firm
connects with its relevant political stakeholders, facilitating a linear and direct CPA
implementation; and through political exchange capabilities, the firm provides political goods

35
valued by its political- stakeholders, thereby increasing its influence during the policy-making
process.
Second, because the framework connects the firm’s market-related resources, processes,
and capabilities to the strengthening of each type of political capability, these mechanisms
reduce the expenditure to acquire those resources and skills necessary to sustain competitive
advantage through CPA. Specifically, since market-oriented firms rely on market-sensing
capabilities and customer-linking capabilities (Day 1994), the framework focuses on these two
capabilities and how their internal processes of stakeholder identification, knowledge
acquisition, and stakeholder communication and engagement can be integrated into the pursuit
of the firm’s political goals. Market-sensing capabilities have a positive impact on the firm’s
political sensing capabilities by identifying broader policy risks and opportunities; on political
access capabilities by signaling to political stakeholders the firm’s higher expertise resources;
and on the firm’s political exchange capabilities by leveraging its superior information in
exchange for favorable policies. Customer-linking capabilities have a positive impact on the
firm’s political access capabilities by providing superior communication opportunities and
engagement touchpoints with its political stakeholders, and on the firm’s political exchange
capabilities by reducing the costs of implementing a constituency-building strategy and by
increasing the effectiveness of the persuasion capacity of its information exchange strategies.
Overall, firms with this market-related capability can implement more preemptive, direct, and
influential CPA compared to their competitors, which helps to sustain competitive advantage and
increase the cost-effectiveness of political strategies.
A key managerial implication of this chapter is the strategic advantage of analyzing the
firm’s political strengths and weaknesses through the political capabilities’ taxonomy.

36
Identifying where the firm is positioned within this taxonomy represents an important source
of information for the firm’s political strategic planning. Since it clarifies the different processes
and political resources involved in the development of the political sensing, political access,
and political exchange capabilities, the firm can identify, and therefore reverse, its weaknesses
in the CPA implementation. In doing so, the firm can make a better-informed decision about
the most cost-efficient CPA strategy to implement and can evaluate the cost-opportunity of the
different expenditures to accumulate the political resources it requires (i.e., deciding if it’s better
to outsource some of the CPA processes in the short term by hiring a lobbying firm).
Furthermore, the framework outlined in this chapter, connecting market-capabilities
market capabilities to the development of political capabilities, provides a general guideline for
firms to engage in the policy environment even if they have limited resources or simply have no
experience with CPA implementation. Managers might be discouraged from engaging in
political strategies given political and market activities compete for limited internal resources
within the firm (Bonardi, 2008). However, the knowledge that certain readily available market-
related resources, processes, and capabilities are useful assets to achieve political goals,
provides an incentive for firms to participate in the policy arena. Finally, familiarity with the
firm’s market capabilities helps to flatten the learning curve of engaging with political strategies,
accelerating the process of political capabilities attainment.
This project sought to deepen the understanding of how non-market and market
capabilities can be connected to sustain the firm’s competitive advantage. In doing so, it raises
new theoretical questions on the mechanisms by which market-related capabilities facilitate the
development of political capabilities. Some of these involve exploring the potential political
value of market-capabilities beyond market-sensing and customer linking capabilities. The

37
chapter also calls for the development of testable hypotheses based on the “market capabilities
to political capabilities” framework, or even the design of an empirical measure to identify the
firm’s level of political capabilities in each of the categories of the taxonomy. Future research
should explore and test these and other factors that help firms to implement cost-effect CPA by
integrating market capabilities and political capabilities.

38
Chapter 2: Does it Pay for Firms to Be Progressive? The Asymmetric
Effect of Corporate Sociopolitical Activism on Consumers’ Buycott
and Boycott Responses

“Republicans buy sneakers, too” –Michael Jordan, 1990

2.1 Introduction

Corporate sociopolitical activism (CSA) is a novel but highly salient and increasingly
important phenomenon where private companies demonstrate their sociopolitical values by
taking a stand on sociopolitical issues that are not directly related to their core business activities
(Briscoe & Gupta 2016; Chatterji & Toffel 2018; Burbano 2021). These issues, such as gun
control, abortion, and the rights of lesbian, gay, bisexual, transgender, and queer (LGTBQ)
populations, are commonly polarizing. As a result, firms’ engagement in CSA frequently
triggers evaluative biases in consumers, which can result in a change in consumer behavior such
as avoiding purchase (boycotting) and seeking out purchase (buycotting) of the firm’s products
(Kam & Deichert 2020). Both boycotting and buycotting can significantly affect firms’
performance. For example, Nike’s sales increased by 38% after its 2018 advertising campaign
featuring quarterback Colin Kaepernick, known for protesting racial inequality. Conversely,
after Target announced its gender-neutral restrooms policy in 2016, its overall sales fell 7.2% in
its second quarter. As a result, firms must understand how consumers boycott or buycott the

39
firms’ products in response to their CSA strategy, to more accurately estimate whether and how
much firms will be rewarded or punished for engaging in a certain CSA strategy.
However, the existing literature shed limited light on this critical question because of a
lack of knowledge on the comparison of consumers’ responses to firms’ CSA strategies. The
strategy literature has examined CSA’s general effect on consumers’ inclination to purchase but
does not differentiate the effect of different CSA strategies; current studies have also examined
customers’ stated intent to purchase without testing their actual behavior (Chatterji & Toffel
2016, 2017; Dodd & Supa, 2014). The literature on political consumerism, while discovering an
asymmetry in terms of a higher general likelihood of triggering boycotting and buycotting (Reed
et al., 2012; Hydock et al 2020; Panagopoulos et al 2019), has not examined how the same
condition can result in different levels of boycotting and buycotting. This gap represents a
missed opportunity to help firms understand whether a certain CSA action generates different
levels of boycotting and buycotting from various consumers, to strategically increase their
consumer support while reducing the backlash.
I address this gap by developing a novel theoretical framework by integrating the theory
of political consumerism with the screening and neo-institutionalist theories (Bergh et al., 2014;
Connelly et al., 2011; DiMaggio and Powell, 1983; Klein et al., 2004). I argue that, as CSA
engagement communicates the firm’s sociopolitical values (Bhagwat et al., 2020), consumers
will screen the firm’s behavior in search of cues to motivate a political consumerism response.
First, that a firm assumes a pioneer instead of a follower role in promoting a CSA stance provides
information for consumers to infer that the firm is more likely to exercise its agency in advocating
a stance that deviates from that of the customers, thus further increasing the likelihood of
boycotting by ideologically-misaligned consumers. However, I argue that taking a pioneering vs

40
follower role is less likely to trigger buycotting by ideologically-aligned consumers. Second, that
a firm undertakes substantive instead of symbolic actions increases consumers’ assessment that
the firm’s action generates a greater tangible impact on the sociopolitical cause, thus further
increasing the likelihood of buycotting by ideologically-aligned consumers, but it is less relevant
to boycotting by ideologically-misaligned consumers.
To empirically examine my theory, I implement a novel survey experiment through a
panel of 5,171 participants from the online marketplace Prolific with a design that involves real
economic stakes for respondents, therefore, increasing the validity of their answers. I
manipulated several sociopolitical issues including the right to access abortion, stricter gun
control regulations, transgender-inclusive restroom policies, and the information about whether
a firm took a progressive stance on that issue through CSA. In terms of the forms of CSA.
This chapter makes several contributions to the strategy literature. First, to the best of
my knowledge, this is the only study to highlight the asymmetry in consumers’ reaction to
different forms of CSA engagement through real economic stakes, therefore addressing a clear
research gap regarding critical factors that moderate boycotting and buycotting responses.
Second, through a novel survey experiment instrument that generates real economic stakes for
participants, I extend the insights on the impact that CSA has on consumers’ choices and
behavior, as current research mostly looked at self-reported intent to purchase (Chatterji &
Toffel 2016, 2017; Dodd & Supa, 2014) or has focused on other firms’ stakeholders, such as on
employees’ motivation to work (Burbano 2018, 2020, 2021) or investors’ decision to invest
(Bhagwat et al., 2020). Third, the findings carry strong strategic implications for firms seeking
to engage in CSA to maximize consumer reward while reducing its backlash. Lastly, this chapter
also contributes to the political consumerism literature, as it is one of the few studies that

41
simultaneously examine how boycotting and buycotting responses from consumers vary in
different ways under the same condition, therefore further highlighting the asymmetry of these
two forms of political consumerism (Panagopoulos et al 2019).

2.2 Theoretical Background: Political Consumerism and Consumers’ Asymmetric Boycott
and Buycott Practices

When consumers’ purchase decisions are influenced by moral considerations about
companies’ practices around sociopolitical issues such as environmental protection
(Hainmueller & Hiscox 2015), labor standards (Hainmueller, Hiscox, & Sequeira 2015), and
corporate political activities (Panagopoulos et al 2019), this consumer behavior is known as
political consumerism (Keum et al., 2004; Stolle & Micheletti 2015). Boycotting (resisting
purchase) is a punished-oriented strategy motivated by the perceived egregiousness of the
company’s practices when they challenge the values of consumers (Klein et al., 2002, 2004).
Buycotting (deliberate purchase) is a reward-oriented strategy for companies engaging in
practices perceived as favoring tangible outcomes in line with ethical, moral, or political
standards consistent with customers’ views (Friedman, 1996; Neilson, 2010; Sen et al., 2001;
Klein et al., 2004; Hoffmann & Hutter 2012). Ultimately, boycotting and buycott reflect
consumers’ value congruence between their purchase behavior and their political identity,
ideology, and overall preferences.
Through CSA, firms take a position on policy issues related to core political values
(Briscoe & Gupta 2016; McDonnell 2016), that reveal their preferences along the conservative-
liberal ideology spectrum (Chuang, Church, & Ophir 2011; Negro & Olzak 2019). Research on

42
social identity (Ashforth et al., 1989) and affective polarization (Iyengar & Westwood 2015)
show that the signaling of political ideology offers value to individuals with similar values and
inclines them to support the organization (Bundy, Shropshire, & Buchholtz, 2013; Bundy et al.,
2018) while triggering the desire of those with opposing views to discriminate against it
(Iyengar, Lelkes, Levendusky, Malhotra & Westwood, 2012). Therefore, firms that engage in
CSA are likely to experience both boycotting and buycotting responses as consumers seek to
fulfill their value congruence; that is, ideologically misaligned consumers will be triggered to
boycott while ideologically aligned consumers will be motivated to buycott firms.
However, individual boycotting and buycotting responses are not the flipsides of the
same “coin.” While both are grounded on political or moral ethical-moral-ethical motivations
(Yates, 2011), they are triggered by distinct psychological factors (Baek, 2010; Hoffmann et al.,
2018; Kam & Deichert, 2019; Neilson, 2010). Specifically, political consumerism research
shows there exists a “negativity bias” (Kam et al 2020.; Elliot 2006; Baumeister et al., 2001)—
that is, negative information has a greater effect on the attitudinal intentions and behavior of
consumers (Kam & Diechert 2017), for the following reasons. First, consumers respond more
strongly to unethical actions compared to ethical actions (White, Argo, & Sengupta 2012), as
negative stimuli around to carry greater informational value than positive stimuli (Peeters and
Czapinski, 1990). Second, the psychological impetus to avoid negativity is more compelling
than the tendency to approach positivity (Baumeister et al., 2001; Elliot 2006, 115).
These factors theoretically predispose buyers to have stronger motivations to punish
negatively evaluated firms than to reward positively evaluated ones (Endres & Panagopoulos,
2017; Newman & Bartels, 2011; Stolle et al., 2005), as negative information is more effective
in triggering a boycott than positive information is motivating a buycott (Trudel & Cotte, 2009).

43
In sum, the negativity bias is thought of as generating an asymmetry in the political consumerism
responses by making the boycotting threshold to be lower than the buycotting threshold. In other
words, it is easier to trigger consumers’ boycotting than buycotting (Trudel & Cotte, 2009; John
& Klein, 2003; Kam & Deichert, 2019; Rim, Lee & Yoo, 2020). As discussed above, while
pointing out the asymmetry in the general likelihood of trigger boycotting and buycotting, the
extant literature has not examined how specific conditions produce asymmetric outcomes of
boycotting versus buycotting, which I address next.

2.3 Theory and Hypotheses: Asymmetric Effect of Corporate Sociopolitical Activism on
Consumers’ Buycott and Boycott Responses

While firms traditionally refrain from publicly communicating their sociopolitical values
(Gaines-Ross, 2017), various groups of stakeholders have increased their expectations and
pressure on firms to engage in public polarizing debates (Chatterji & Toffel, 2018). This new
challenge of publicly communicating sociopolitical preferences generates many uncertainties
for the firm because there is no clear blueprint on how consumers, whose behavior greatly
determines the tradeoffs of firms’ declaring their sociopolitical positions, will perceive and
respond to the firm’s CSA. To assess the extent to which the firm’s CSA calls for a
buycotting/boycotting response, consumers screen the behavior of firms to detect cues that can
help them reduce the information asymmetry (Bergh et al., 2014; Spence, 1974) regarding the
firm’s genuine engagement with CSA. The theoretical lens of screening and signaling is
consistent with research on political consumerism as reviewed in the previous section (Copeland
& Becker, 2019; Stolle & Micheletti, 2013).

44
Integrating neo-institutional theory with the negativity bias of political consumerism, I
will develop theory and hypotheses that the firm’s type of CSA role (pioneer or follower), and
the type of CSA actions (symbolic or substantive) provide the necessary information for
consumers to assess the firm’s agency in CSA and commitment to the sociopolitical cause, and
therefore motivate their political consumerism response.

2.3.1 Type of CSA Role: Pioneering vs. Follower Role
According to the neo-institutional theory, whether the firm plays a pioneering role or
whether it plays a follower role in the adoption of contested practices critically captures the
degree of agency for its actions (Maguire et al., 2004; DiMaggio, 1988; Westphal & Zajac,
2001). Pioneering CSA signals stronger agency in the firm’s decision to deviate from the
traditional institutional logic which stipulated that firms should not participate in public debates
(Lounsbury 2001, 2007; Meyer & Rowan, 1977; Thornton and Ocasio, 1999, 2008). By contrast,
when a firm adopts a follower CSA role, it is less evident whether the firm actively supports the
sociopolitical cause or if it joins the stance because of mounting pressure from other stakeholders
or growing isomorphism processes (Marquis et al., 2007).
Recall that boycotting is triggered by the perception that the firm is willingly engaging in
a strikingly wrong and egregious act (Balabanis, 2013; Hoffmann & Müller, 2009; Klein et al.,
2002, 2004) that deviates from established practices and challenges dutiful citizenship norms
(Copeland, 2014). Perceived agency in firms’ action, manifested through the pioneer vs follower
role, reveals even greater willfulness of the firm to engage in CSA. More pioneering through a
pioneering role, not only is the firm challenging the ideological preferences of misaligned
consumers, but it is also seen as leveraging its resources to create new institutions or to change

45
existing ones (Maguire et al., 2004; DiMaggio, 1988) to protect the interest of certain stakeholders
with a contrary set of ideological preferences around the sociopolitical issue at hand. Therefore,
taking a pioneering role demonstrates greater agency, thus exacerbating the level of the
egregiousness of the firm’s CSA stance perceived by consumers who have an opposing ideology.
As a result, pioneers can therefore face the greatest negative sanction from misaligned consumers
because the agency increases the perceived egregiousness of the CSA stance.
By contrast, if the firm shows no clear agency in leading CSA, then it cannot be attributed
equal levels of accountability for deviating from the norm and for supporting a sociopolitical
stance contrary to the consumers’ preferences. As more firms speak out on a sociopolitical issue
through CSA, the contested practice of engaging in CSA will start to gain greater external
legitimacy through the convergence in the behavior of a larger number of actors (Galaskiewicz,
1985, 1997; Hoffman, 1999; Westphal & Zajac, 2001). Therefore, as a firm takes a stand
alongside its peers, the degree of egregiousness in the eyes of consumers with a misaligned
ideology is diffused by the “acceptance” or “resignation” effect of the coalition. This indicates
that the backlash to the CSA act is more likely to be dispersed as more firms join the stance,
providing safety in numbers” (Bhagwat et al., 2020; Chatterji & Toffel, 2018). As a result, the
risk of a follower firm in CSA experiencing boycotting is lowered.
In sum, while the baseline expectation is that ideologically misaligned boycotted firms
that take CSA actions, the motivation of boycotting an individual pioneer firm is even greater
than boycotting the individual firm that chooses to join collective actions in engaging in CSA.
Therefore, I predict the intensity of the boycotting will be greater when firms assume a pioneer
CSA role compared to a follower CSA role.

46
H1a: Ideologically misaligned consumers are more likely to engage in boycotting firms
that take on a pioneering role, than those that take on a follower role, in demonstrating their
sociopolitical stance.
However, I argue that playing a pioneering role is not sufficient to trigger buycotting.
Buycotting is primarily triggered when the values of organizations consumers that of consumers
and when there is revealed commitment of the organization towards a specific cause (Bundy,
Shropshire, & Buchholtz, 2013; Bundy et al., 2018). The latter condition is important because
consumers are commonly skeptical of opportunistic acts undertaken by corporations (Morsing
2017; Deephouse, 1999; Meyer & Rowan, 1977). The pioneering role, while indicating the
agency of the firm, provides no information about the most important dimension that buycotting
consumers care the most about—that is, the additional revealed commitment of the organization
to advance the sociopolitical cause that these consumers support. Therefore, even if the firm is
perceived as willingly engaging in a CSA via assuming a pioneer rather than follower role, this
is not “enough” to persuade ideologically-aligned consumers boycotting. This willingness itself
does not necessarily entail committing real resources to advance the cause. In other words, the
firms’ perceived agency is less influential, compared to firms’ actual commitment, to driving
consumers’ to buycott.
Therefore, as long as ideologically-misaligned consumers perceive the firm to be willing
to engage in CSA, this information is sufficient to trigger their desire to discriminate against and
punish the firm through boycotting. This desire to boycott will be greater than ideologically-
aligned consumers’ desire to reward the firm through buycottig, because the firm’s agency does
not provide enough information that the firm provides tangible outcomes for the sociopolitical
cause.

47
H1b: take that takes on a pioneering role in demonstrating their sociopolitical stance are
more likely to trigger boycotting by ideologically misaligned consumers than buycotting by
ideologically aligned consumers.

2.3.2 Type of CSA Actions: Substantive vs Symbolic Actions
According to neo-institutional theory, the most salient features that determine a firm’s
commitment to a cause are whether firms engage in substantive acts which require an investment
of intensive resources or whether firms only involve symbolic acts that require minimal resource
commitment, such as verbal support for the cause (Connelly et al., 2011; Kim & McAlister,
2011). Substantive CSA signals a strong commitment to the firm’s decision to contribute with
time and resources to produce tangible outcomes for a cause (Kim & McAlister, 2011). By
contrast, when a firm adopts symbolic CSA actions, it can be taken as an opportunistic act to
satisfy the stakeholder demands to enter the sociopolitical domain and take a public stance on
their values (Hoppner & Vadakkepatt, 2019; Barton et al., 2018; Edelman, 2018; Larcker &
Tayan, 2018) without being an agent of change. Therefore, I argue that the firm’s CSA
commitment manifested through the substantive vs symbolic actions, mainly affects the
consumers’ perceived contribution of the firm to sociopolitical causes, therefore affecting the
buycott response.
Recall buycotting is primarily triggered when consumers perceive the revealed
commitment of the organization towards a specific cause (Bundy, Shropshire, & Buchholtz,
2013; Bundy et al., 2018). Substantive CSA signals a genuine commitment because it requires
higher levels of resources and accountability (Kim & McAlister, 2011). An example is
Starbucks’ pledge to hire refugees to express its disapproval of the former Trump’s

48
administration immigration policies (Disis, 2017). This action requires devoting economic
resources (hiring people) and is more difficult to reverse; therefore, it signals greater levels of
corporate commitment to the sociopolitical cause (Klein, Smith, & John, 2004). Other more
common types of substantive CSA acts involve signing public letters addressed to policymakers
with specific requests to attain a policy goal. An example of this case is the 145 companies
requesting stricter gun control regulations to the Senate in 2019. These letters represent a
common form of CSA (Bhagwat et al., 2020), in which companies must devote time and internal
resources to develop the content of the petition and submit it to their target political stakeholders.
Furthermore, these letters which contain specific petitions now publicly hold the companies
accountable for their content. In other words, through a substantive role, the firm is leveraging
its resources to produce institutional change (Maguire et al., 2004; DiMaggio, 1988) on the
issues that are salient for aligned consumers.
Conversely, symbolic CSA entails verbal support to the sociopolitical cause, which
makes the firm’s commitment to the sociopolitical cause seen as less credible (Yoon et al., 2006;
Becker-Olsen et al., 2006; Skarmeas & Leonidou, 2013) as it can be seen as an aspirational talk
and an opportunistic attempt to appear moral without paying economic costs (Wagner et al.2009;
Bromley and Powell 2012). Just as in the context of environmental practices this lack of
credibility is labeled as “Greenwashing”, in the case of CSA, inauthentic commitments to
sociopolitical causes have been referred to as “woke washing” (Sobande, 2019; Vredenburg et
al., 2018). How firms can overcome this scrutiny and signal their genuine commitment
(Newman & Smith, 2016) is through concrete, substantive actions. The neo-institutional theory
reveals that symbolic acts can be perceived as an attempt to fulfill such stakeholders’ demands
for CSA without necessarily involving the company in a process of change (Meyer & Rowan,

49
1977; DiMaggio & Powell, 1983). Examples of symbolic CSA without much resource
commitment include communicating the firm’s sociopolitical values through channels such as
social media, news articles, or marketing campaigns. An example would be branded using
Twitter to post messages in support of LGBTQ rights under #PrideMonth hashtags but without
contributing economic resources to advancing the cause. Because of the risk of false support,
symbolic actions are not always positively rewarded (Westphal & Zajac, 1998; Walker & Wan,
2012), especially when consumers think companies do not “walk the talk” (Lyon &
Montgomery, 2015; McDonnell & King, 2013).
Therefore, screening whether the type of CSA actions undertaken by firms is likely to
be symbolic or substantive is a powerful tool for ideologically-aligned consumers to assess the
firm’s commitment to the sociopolitical cause. Given that buycotting is more likely to occur
when consumers are convinced of the revealed commitment of a firm to the sociopolitical cause
that they support, it is more likely for a firm to experience buycotting if they engage in
substantive CSA actions, which is seen as making a greater commitment to the sociopolitical by
ideologically aligned consumers, than if firms engage in symbolic CSA actions.
H2a: Ideologically aligned consumers are more likely to engage in buycotting
firms that commit to substantive actions, than symbolic actions, in demonstrating their
sociopolitical stance.
Recall the negativity bias psychologically predisposes consumers to be more readily
motivated to boycott than to buycott, as the negative stimulus is found to carry greater
informational value than positive stimuli (Peeters & Czapinski, 1990; Kam et al., 2020.; Elliot
2006; Baumeister et al., 2001; Rim et al., 2020). Because of this bias, the threshold to trigger a
boycott is theoretically lower than the threshold to trigger boycott. In developing H1a and H1b,

50
I stated that merely knowing that a firm may truly agree with the sociopolitical cause that
consumers are against (indicated by stronger signals of agency in engaging CSA) —even without
having committed substantive resources to advance the cause—is sufficient to trigger their desire
to discriminate against and punish the organization through boycotting. In other words, if
consumers have sufficient information to judge that firms have a true willingness to engage in
CSA, even taking symbolic actions is sufficiently egregious to trigger a boycotting response.
Therefore, for a firm to show it is committing resources to the political cause does not provide
additional information for consumers to ascertain the willingness of the firm to engage in CSA
as the firm’s agency provides sufficient information for consumers to determine it.
Therefore, whether consumers perceive the firm to be more committed to the
sociopolitical cause through substantive acts, while affecting the motivation for buycotting, plays
a less important role in affecting the likelihood to boycott. Therefore, this logic can be
summarized in the last hypotheses:
H2b: Firms that commit to substantive actions versus symbolic actions in
demonstrating their sociopolitical stance are more likely to trigger buycotting by
ideologically aligned consumers than boycotting by ideologically misaligned consumers.
Therefore, from the above theoretical discussion we can conclude that the type of CSA
role (pioneering vs follower) is a more important determinant of a boycotting response than the
type of CSA action (substantive vs symbolic): As long as ideologically-misaligned consumers
perceive the firm has as a strong agency and willingness to engage in CSA through a pioneering
role, how the firm pursues CSA, whether through substantive or symbolic actions, does not
provide additional valuable information to trigger a boycotting response. This conclusion is
summarized in H3a:

51
H3a: The difference in the boycotting response of ideologically misaligned consumers
will be greater for firms that take on pioneer roles vs follower roles, compared to the difference
in boycotting in response to firms’ substantive vs. symbolic actions.
Conversely, the type of CSA action (substantive vs symbolic) is more important in
determining a buycotting response than the type of CSA role (pioneering vs follower): as long as
ideologically-aligned consumers perceive the firm is contributing to advance the sociopolitical
cause through substantive actions, the agency and willingness of the firm to contribute to the
cause do not provide as additional valuable information to trigger a buycotting response. This
conclusion is summarized in the following hypothesis:
H3b: The difference in the buycotting response of ideologically aligned consumers will
be greater for firms that commit to substantive actions vs symbolic actions, compared to the
difference in buycotting in response to firms’ taking on pioneer and follower roles.

Table 2.1. Summary of Hypothesis

52
2.4 Experimental Design

I adopt a novel survey experiment instrument (Kam and Deichert, 2020) and implement
a survey experiment on the online labor marketplace Prolific. A total of 5176 participants from
the platform responded to a 10-minute survey on 24 Apr 2021 in which the experiment was
embedded. Only U.S.-based participants were eligible to participate. The study examines the
causal effect of a firm taking a progressive stance on a social-political issue on the subjects’
willingness to buycott or boycott the firm, based on the subjects’ policy preferences. Instead of
asking subjects about their willingness to boycott or buycott. I use a novel survey method to
increase subjects’ economic stake in choosing one behavior or the other, the questions and
information provided to subjects in the survey experiment refer to real-life events where existing
firms either chose to take a progressive stand on the policy issues of the right to access abortion,
stricter gun control regulations or transgender-inclusive restrooms.

2.4.1 Demographic Questions and Policy Issue Preferences
Subjects were asked about their gender, age, education, political ideology, and times
they watched the news per week. Then they were then randomly assigned to one of three
sociopolitical policy issues: the right to access abortion, stricter gun control regulations, or
supporting transgender-inclusive restrooms. Based on this assignment, they answered with a 5-
point Likert scale (5= Strongly Agree) to one of the following questions, respectively, to gauge
their positions on those issues, a) “Do you think access to abortion should be banned or have
significantly stricter regulations (i.e., only allowing abortion in very extreme cases such as when
the mother's life is at risk)?”; b) “Do you think gun control regulations should be stricter?” ; c)

53
“Do you think people should only be allowed to use public restrooms consistent with one’s
biological sex at birth, regardless of one's gender identity?”. Whichever randomly assigned
policy issue was presented was then combined with a randomly assigned treatment condition in
the following section. For example, if subjects were asked about their opinion on the issue of
abortion, subjects were then exposed to a randomly assigned treatment condition referring to
firms linked to the issue of abortion rights.

2.4.2 Manipulations and Treatment Conditions
The experimental design had a total of 15 conditions (3 policy issues by 5 treatment
groups, including the control group). For the treatment, subjects were asked to choose which
given firm took a progressive stance on a policy issue (i.e., the right to access abortion, to have
stricter gun control regulations, having transgender-inclusive restrooms). Subjects had two firms
to choose from as an answer (Firm A and Firm B). Depending on the issue, Firm A/Firm B had
different company names
1
. Subjects assigned to the policy issue “right to access abortion” were
given the pair MAC Cosmetics (Firm A) and Sephora (Firm B) as options. Subjects assigned to
the issue of “stricter gun control regulations” were shown REI (Firm A) and Dicks Sporting
Goods (Firm B) as options. For the policy issue of “transgender-inclusive restrooms”, subjects
had to answer by choosing between GAP (Firm A) or Abercrombie & Fitch (Firm B).
After their selection, the correct answer was displayed, therefore informing subjects
about which firm was the one that took a progressive stance and how. Firm A was systematically
the correct answer, as it was the activist firm that indeed took a progressive stance on the policy

1
These are real life scenarios in which companies did take (not take) a stance of the issues of abortion, gun control
and gender-neutral restrooms. To increase the external validity of the study, I chose to capture events where firms
engaged in CSA. I chose the closest industry equivalent that remained non-politically active to increase the internal
validity. The study was approved by the Institutional Review Board (IRB) at the University of Southern California.

54
issue. Firm B was systematically a nonactivist firm from the same industry as Firm A. This
means that Firm B in real life is a company that has not engaged, till the date of the experiment,
in the policy issue displayed to the subjects. The design primes subjects to learn about Firm A
being an activist progressive firm, whereas no other information is given about Firm B.
There were four treatment conditions where the type of information displayed about
how the firm engaged in CSA was randomly varied across the dimensions of interest. For the
type of CSA role, firms were presented as either being the first to engage in CSA (pioneer role)
or joining a collective of firms that had already taken the stance (follower CSA). For the type of
CSA actions, the firm was presented as taking a public stance supporting a cause (symbolic
action) and contacting legislators through targeted advocacy letters (substantive action). Once
again, these treatment conditions reflect the actual way in which the corresponding firms
engaged in CSA for each policy issue in real life. The treatment conditions include the following:
a. Pioneer Symbolic: the firm was one of the first to take a progressive stance supporting one
policy issue.
b. Pioneer Substantive: the firm was one of the first to take a progressive stance supporting
one policy issue and acting on the petition by sending a public letter to legislators advocating
for that cause.
c. Follower Symbolic: the firm joined many other firms in taking a collective stance on the
policy issue.

55
d. Follower Substantive: the firm joined many other firms in taking a progressive stance and
acting by sending a joint letter to letter to legislators advocating for that cause.

2.4.3 Attitudinal Measures: Questions About Firms
After being exposed to the treatment conditions, the subjects completed a survey about
their attitudes towards the previously given Firm A and Firm B and were asked to self-select
into one of two gift card raffles. Subjects answered a series of questions, as indicated below,
about each of the firms presented in the treatment conditions (MAC Cosmetics and Sephora;
GAP and Abercrombie and Fitch; REI and Dick’s Sporting Goods). For each firm in the given
pair, subjects were asked whether they had a good opinion about the firm if they were willing to
invest in it, how likely were they to buy in the following week, and if they supported the firm’s
response to the socio-political issue were collected on a 3-point Likert scale with Agree, Neutral
and Disagree.

Table 2.2. Summary of Treatment Conditions as Displayed to Subjects

56
2.4.4 Behavioral Measures: Choice of Gift Card for Raffle
Researchers have documented a gap between the expression of political consumerism
and actual behaviors (Boulstridge & Carrigan, 2000; Ulrich & Sarasin, 1995). Because of this
concern, the last section of the survey entails a novel approach of using real monetary stakes to
test if subjects are willing to buycott or boycott a firm after being exposed to the treatment
conditions.
Subjects were asked to choose one of two gift card raffles to recognize their
participation in the survey. The pair of gift cards presented corresponded to the respective firms
presented in the multiple-choice answers during the treatment conditions (MAC Cosmetics vs
Sephora; GAP vs Abercrombie and Fitch; REI vs Dick’s Sporting Goods). Each gift card had
attached a different dollar amount ($30 or $50). Subjects were presented a specific firm-credit
gift card combination depending on their self-disclosed policy preference on the issues of
abortion rights, gun control restrictions, or transgender-inclusive restrooms.
Subjects were grouped into the category of “Liberal Subjects” if they strongly agreed
or agreed with full access to abortion rights, stricter gun control regulations, or having
transgender-inclusive restroom policies, based on their answers to earlier questions. Subjects
were grouped into to the category “Conservative Subjects” if they were strongly against or
against full access to abortion rights, stricter gun control regulations, or having transgender-
inclusive restroom policies. For liberal subjects, they are offered to enter a raffle for a smaller
amount of gift card ($30) for firms that took a progressive sociopolitical stance (Firm A) or to
enter a raffle for a larger gift card amount ($50) for the nonactivist (Firm B). For conservative
subjects, the offering reverses: They can choose a raffle for a larger-amount gift card ($50) for

57
the firms that took a progressive sociopolitical stance (Firm A) or a raffle for a smaller-amount
gift card ($30) for the nonactivist firm (Firm B)
This firm-credit pair design allows identifying buycotting and boycotting practices.
Subjects that choose the gift card of smaller value reveal a purchase behavior consistent with
their policy preferences, as either rewarding or punishing a firm entails real monetary stakes and
costs for the subjects themselves.

2.4.5 Measures and Analysis
a. Dependent Variables. The main dependent variables are Boycotting and
Buycotting. Both these variables are dichotomous. Boycotting is coded as 1 if at the end of the
survey subjects with conservative preferences choose to participate in the gift card raffle of
smaller value ($30, i.e., that of the non-activist firm), foregoing the gift card with higher value
($50, i.t., that of the progressive firm). Buycotting is coded as 1 if at the end of the survey
subjects with progressive preferences choose to participate in the $30 gift card raffle (i.e., from
the progressive firm), foregoing the gift card with higher value ($50, i.e., that of the conservative
firm). The third dependent variable of interest is attitudinal, which is the subjects’ Good Opinion
About the Firm, measured on a 3-point agreement Likert scale, where 1 indicates “Disagree”2
“Neither Agree nor to Disagree”, and 3 “Agree” for the statement “I have a good opinion about
this firm”.
b. Independent Variables: The political stance manipulations are binary variables
that equal 1 if subjects were assigned to the named condition and 0 otherwise. The indicator
variables for the treatment conditions are Pioneer Substantive, Pioneer Symbolic, Follower
Symbolic, Follower Substantive, and Control. These treatment conditions are further collapsed

58
into the two independent factor variables named Type of CSA Role (follower treatment, pioneer
treatment, or control group) and Type of CSA Action (substantive treatment, symbolic treatment,
or control group). Lastly, I categorize subjects as being aligned or misaligned with the firms’
sociopolitical stance based on their self-reported preferences about gender-neutral bathrooms,
access to abortion rights, and gun control regulations.
c. Other variables and controls: The regressions include control variables that
could potentially influence the respondent's willingness to buycott/buycott and opinion about
the firms disclosed in the treatment conditions. These variables include gender, age range,
political ideology, level of education, how many times per week they follow the news, if the
subject agrees with firms taking sociopolitical stands on issues unrelated to their business
activity, and if the subject agrees with firms taking public stances on sociopolitical issues
unrelated to their core business activity. All of these are coded as dummy variables. Gender is
coded as Male, Female, or Other. Age range is coded as 18-30, 31-40, 41-50, 51+. Political
ideology is coded as Liberal, Conservative, and Independent. Levels of education include
Primary, Secondary, Undergraduate, Graduate, or Post-Graduate. The frequency of following
news per week is coded as Less than once per week, Between one and four times a week, and
More than four times a week. Opinion on firms taking sociopolitical stands is coded as Agree,
Disagree, and Neutral. The policy issues are abortion rights, gun control, and transgender
restrooms.

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2.5 Results

I test the effect of a firm taking a progressive stance on a polarizing policy issue, on the
subjects’ attitudes towards the firm, and the buycotting/boycotting response through a gift card
choice. The first set of results (Table 3 and Figure 4) demonstrates the overall treatment effect
of CSA on political consumerism, while the rest of the section focuses on more fine-grained
treatment conditions of Pioneer-Symbolic, Pioneer-Substantive, Follower-Symbolic, and
Follower-Substantive, in comparison with the control group. Recall that in these treatments, the
firm consistently takes a progressive stance on a sociopolitical issue but how the firm takes the
stance varies. Subjects are grouped as conservatives or liberals depending on their policy
preferences. The control condition is the suppressed reference group in the OLS and Logit
models.

2.5.1 Overall Effect of CSA
Table 3.3 shows that the aggregated effect of the treatment is statistically significant on
subjects’ good opinions about that firm. Specifically, for liberal subjects, the treatment of
learning Firm A takes a progressive stand on a given issue significantly increases the likelihood
of having a good opinion about the firm, compared to their control condition. Conversely, for
conservative subjects, the treatment of learning Firm A takes a progressive stand on a given
issue significantly decreases the likelihood of having a good opinion about Firm A, compared
to their control condition. More precisely, receiving the treatment with information about a firm
taking a progressive stance has a significantly (χ² test, p<0.01) effect in nearly doubling the odds

60
of liberal subjects’ likelihood of developing a good opinion about Firm A, while conservative
subjects have less than half the odds of developing a good opinion.
Figure 2.1 shows the proportion of subjects that chose to buycott and boycott the
progressive firm after receiving the treatment. Based on the gift card choice, 61% of liberal
subjects buycotted the firm after learning it took a progressive stance, compared to the 37% of
their control group. For conservative subjects, 45% boycotted the firm after learning it took a
progressive stance, compared to the 24% in the control group. The differences in means tests
between conservative and liberal subjects with their respective control group are statistically
significant, demonstrating the existence of an overall treatment effect. Therefore, the firms’ CSA
influences subjects' attitudes and political consumerism responses based on their ideological
alignment or misalignment with the firm.

Figure 2.1. Mean Boycott and Buycott Response, Based on Subject’s Ideology

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Table 2.3. Ordered Logistic Regression: Effect of Treatments on the Subjects’ Positive
Opinion About the Company That Took a Progressive Stance

2.5.2 Type of CSA Role: Pioneer vs Follower
The following results examine whether conservative subjects misaligned with a firm’s
progressive stance are less likely to boycott when the firm’s type of CSA role is that of a follower
rather than a pioneer leading the CSA engagement. Figure 2.5 shows the difference in means for
boycotting and buycotting responses for each treatment group. Table 2.4 and table 2.5 show the
difference in the means test for boycotting responses and buycotting responses, respectively,
based on the type of CSA Role (follower/pioneer). These results provide support for the H1a and
H1b hypotheses. According to the theory, the type of CSA role is sufficient to trigger a boycott
response, and the difference between the follower and pioneer role boycotting levels will be
greater than for buycotting levels.

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Table 2.4. Conservative Subjects: Difference in Means Test for Boycotting Follower and
Pioneer Treatment

Table 2.5. Liberal Subjects: Difference in Means Test for Buycotting Follower and Pioneer
Treatment

Figure 2.2. Mean Boycotting and Boycotting for Type of CSA Role: Follower and Pioneer
Treatments

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2.5.3 Type of CSA Action: Substantive vs Symbolic
The following results examine whether liberal subjects, ideologically aligned with a
firm’s progressive stance, are more likely to buycott when the firm’s type of CSA action is
substantive rather than symbolic. Figure 2.3 shows the level of buycotting and buycotting for
each treatment group. Table 2.6 and Table 2.7 show the difference in the means test for
buycotting responses and boycotting responses, respectively, based on the type of CSA Action
(substantive/symbolic). Contrary to hypothesis 2a, there is no difference in the level of
buycotting based on substantive or symbolic treatments. There is no evidence for greater reward
(buycotting) amongst subjects where the firm engaged in substantive CSA (by writing advocacy
letters to legislators) whether its role was that of a pioneer or a follower.
All treatment groups show a statistically significant buycott response compared to the
control group, with no difference in the mean value of buycotting amongst the treatments.
Therefore, there is no evidence to support the H2a hypothesis. However, table 2.7 shows there
is no difference in means between the treatment groups for misaligned consumers, providing
support for hypothesis 2b, as the substantive CSA action displays no greater boycotting levels
than symbolic CSA actions. In other words, this dimension is not as relevant in moderating a
buycotting response as the Type of CSA Role, as predicted in H1a and H1b.

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Figure 2.3. Mean Boycotting and Boycotting for Type of CSA Action: Symbolic and Substantive
Treatment

Table 2.6. Liberal Subjects: Difference in Means Test for Buycotting Substantive and
Symbolic Treatment

Table 2.7. Conservative Subjects: Difference in Means Test for Boycotting Substantive
and Symbolic Treatment

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To clarify the underlying mechanisms that explain why consumers were highly
motivated to buycott, regardless of the treatment conditions, 10 buycotting consumers were
interviewed, ad recruited based on their response ID to the survey experiment. Participants were
asked follow-up questions regarding their reasoning behind boycotting a progressive firm under
different circumstances. Most subjects agreed that a firm joining other companies shows a very
little level of commitment to the cause and that taking concrete actions is better than simply
voicing support for a sociopolitical issue.
However, because CSA is still uncommon, being the first firm to break the silence
regarding a sociopolitical issue is seen as a brave act that deserves recognition, even if there is
no substantive action. Furthermore, writing letters to legislators is perceived as the minimum a
firm can do to advocate for a cause, given corporations have great resources. Overall, subjects
agree they would buycott any firm for taking a progressive CSA stance because it is more
important to provide visibility for an issue, regardless of its true intentions by engaging in CSA
or the resources it provides. The findings in this section indicate that the threshold to buycott is
not, after all, lower than to boycott when it comes to CSA.
Lastly, table 2.8 and table 2.9 show the difference in means test comparing boycotting
and buycotting levels for all the treatment groups. These results provide support for H3a, which
states that the difference in the boycotting response of ideologically misaligned consumers will
be greater for firms that commit to pioneer roles vs followers, compared to the difference in
symbolic vs substantive actions. However, there is no support for H3b, since the buycotting
response is consistently high (sound 60%) regardless of the type of CSA role (follower/pioneer)
or CSA action (symbolic/substantive).

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Table 2.8. Conservative Subjects: Difference in Means for Boycotting Responses Per
Treatments

Table 2.9. Liberal Subjects: Difference in Means for Buycotting Responses Per Treatment
Group

2.6 Conclusion

Corporate sociopolitical activism is becoming an increasingly common phenomenon
amongst firms (Chatterji and Toffel 2019; Chin, Hambrick, and Treviño 2013; McDonnell2016,

67
Briscoe and Gupta 2016; McDonnell 2016). However, there is little empirical work on how the
different ways in which firms engage in sociopolitical actions might impact consumer behavior.
Some recent experimental research has shown consumers are likely to buycott and boycott when
they learn about the campaign contributions of different firms (Panagopoulos and Costas 2020).
The question is if this behavior extends to all forms of political behavior of the firm, including
corporate sociopolitical activism.
This study examines the causal effect of consumers learning about a firm engaging in a
progressive CSA stance on their decision to buycott or boycott such a firm, by implementing a
survey experiment with 5,106 US citizens through the online marketplace Prolific. The treatment
conditions were designed along two key dimensions to examine how firms communicate their
commitment to a sociopolitical cause: Type of CSA Role (pioneer vs follower) and Type of CSA
Action (symbolic vs substantive).
Three key findings stem from this research. First, CSA does elicit a political
consumerism response, with higher levels of buycott compared to boycott, regardless of the
firm’s role and actions. Second, the boycott is higher when the firm takes on a pioneering role
in promoting for the first time a CSA style while the rest of the companies remain largely silent
on the topic. Third, regardless of the role the company takes or the type of actions it implements,
liberal respondents systematically buycott the firm. Therefore, contrary to conventional wisdom
in political consumerism literature, the threshold to buycott is lower than to boycott when it
comes to CSA.
In-depth interviews on the logic behind liberal consumers' decision to buycott the firm,
regardless of its role and actions. Most importantly, liberal participants expressed that a
simple public stance already provides enough attention and visibility to the sociopolitical issue

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at hand. Therefore, even though it is preferable to engage in substantive actions, symbolic
stances are still valuable. Furthermore, liberal subjects did not perceive that firms directly
contacting legislators advocating for a sociopolitical cause were engaging in substantive action.
Such advocacy action is perceived as equally as influential for the sociopolitical issue as a firm
simply taking a public stance in the media.
Finally, this study provides clear policy implications for practitioners in the way they
can implement CSA engagement strategies eliciting greater stakeholder support and minimizing
backlash. Given the firm is predicted to receive greater buycott responses compared to buycott,
even by engaging in symbolic actions just as a public stance, firms are encouraged to express
their progressive views. Furthermore, since when the firm is portrayed to follow other companies
in joining the same CSA stance the buycott response is lower, firms that wish to engage in CSA
are encouraged to monitor sociopolitical issues that other companies are already talking about
and consider joining the stance.
Overall, this study contributes to our understanding of the behavioral consequences of
CSA for the firms’ stakeholders. Future research should further examine the mechanisms that
explain consumer responses to a firm’s actions and identify ways in which firms can choose
how to strategically engage in CSA in a way that increases the positive attitudes towards the
firm while reducing the backlash.

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Chapter 3: Private Groups vs Public Interests: Who Has Greater
Access to Legislators? A Lobbying Field Experiment and Survey in
Spain

“Interest groups can only gain access to decision-makers if they can offer a
resource that other groups cannot provide more efficiently.”

Dür & Mateo, 2016

3.1 Introduction

One of the key tenets of representative democracy is the equal right for organized public
and private interests to share their preferences by petitioning elected officials. In practice,
political access is not equally distributed, therefore making the conditions under which interest
groups successfully enter the legislative institutions a central research puzzle for scholars
(Beyers, 2002, 2004; Bouwen 2004; Ehrlich 2007; Grossmann, 2012; Kalla & Broockman,
2015; Naoi & Krauss, 2009). While most studies have focused on incumbent interest groups
that regularly participate in the policy-making process, little attention has been paid to how
newly petitioning organizations, outsiders to the lobbying process, manage to access legislators
for the first time. This scope offers a promising venue to examine the effect of group type on
political access, specifically, if there is interest representation bias between private economic
interest groups and nonprofit public interest groups (Alves, 2020; Dür & Mateo, 2016; Fraussen
et al., 2015; Gilens & Page, 2014; Drutman, 2015; Hindmoor & McGeechan, 2013).

70
According to conventional wisdom, private economic interest groups enjoy a
comparative advantage in their political access due to their superior resource endowments
(Coen 1998, 1997; Dür & De Bièvre, 2007; Dür & Mateo, 2016; Lowery & Gray, 2004). Even
in European democracies where campaign-financing regulations restrict corporate donors,
private groups have greater material means to acquire and provide political goods (i.e., technical
expertise) to connect with their target legislators (Bouwen, 2002; Beyers, 2004; Beyers et al.,
2008; Eising, 2007). However, the determinants of political access are very different for newly
petitioning organizations, defined as those groups that directly contact a legislator for the first
time.
For policymakers, the cost of granting access to a newly petitioning group is
comparatively high due to uncertainty: legislators must assess, with limited information, what
type and amount of necessary political goods is the newly petitioning organization likely to
deliver, given resources are unequally distributed across groups (Olson, 1965). Therefore, the
main incentive to grant initial access is the perception that engaging with newly petitioning
organizations provides a clear political opportunity to increase the chances of reelection or
succeeding in the policy-making process (Austen-Smith, 1993; Hansen, 1991; Hall &
Deardorff, 2006; Wright, 1996).
In this context, the chapter argues that nonprofit public interest groups enjoy an initial
political access advantage because their social desirability and positive social reputation
maximizes the legislator's political opportunity. Legislators place greater trust in entities that
advance public interests, instead of exclusively narrow private interests (Jia, 2018; Leech, 2013)
because their positive social reputation signals that the organization will share truthful
information (Stevens et al., 2016; Zimmerman & Zeitz, 2002), will provide insight about

71
broader constituent preferences (Berry, 1999; Coen & Katsaitis, 2013; Kollman, 1998;
Mahoney, 2008), will help the legislator to be perceived as responsive to those constituents
(Ainsworth, 1997; Bartels, 1991; Berry & Howell, 2007; Miller & Wattenberg, 1985), and will
overall add legitimacy to the policy making process by including diverse groups in the debate
(Dür et al., 2015; Rasmussen & Gross, 2015; Klüver, 2013; Flöthe & Rasmussen, 201).
To test the extent to which an organization's type of interest affects its initial political
access, the current project implements a lobbying field experiment in Spain and a novel elite
survey with policy makers. The lobbying field experiment was implemented by partnering with
a private business group and a nonprofit organization. These entities sent a formal first-time
meeting request to 400 national and regional representatives, assigned through blocked
randomization by gender and party ideology. Results show that a public interest organization is
more likely to have its meeting request accepted, even when its issue expertise is unrelated to
the legislator's policy work and committee appointments. For the private interest group, a shared
policy issue-domain predicts both the response to the organization's email and the acceptance
to schedule a meeting. The original survey amongst Spanish national and regional legislators
shows that legislators receive a similar proportion of meeting requests from both private and
public interest groups, though public interest groups petition liberal legislators more often.
The key contribution of this chapter is the ability to isolate the organizations' public or
private interest from the legislators’ decision to grant access. This is the first study, to the best
of my knowledge, that provides a causally identified estimate on the effect of an organization's
type of interest on achieving initial political access in a Western European democracy. The
findings have important implications and suggest new puzzles for future research. First, they
challenge the conventional expectation that private interest groups systematically enjoy a

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political access advantage. If initial political access favors public interest groups, scholars could
explore at what stage we observe the policy-making process primarily advances the interests of
business and professional associations (Coen & Richardson, 2009; Rasmussen & Brendan,
2014; Schlozman et al., 2012; Yackee, & Yackee, 2006). Similarly, the findings encourage
examining the varying importance that legislators' ideology can have on predicting which
interest groups they associate themselves with. In this study, both liberal and conservative
legislators displayed similar responsiveness to each newly petitioning organization, regardless
of their interest type.
Lastly, the results provide support for previous research on the relationship between
reputation and political access (Coen, 1998, 2009; Bouwen, 2004; Werner, 2015), by showing
the extent to which social reputation facilitates the access of a newly petitioning interest group.
This has clear policy implications for practitioners in search of mechanisms to increase their
political comparative advantage when petitioning their target legislators. The chapter is divided
as follows. The first section summarizes the literature on interest group representation bias and
introduces the existing gap on the initial political access of outsider organizations.
The theory section focuses on the informative role of social reputation and predicts the
conditions under which legislators grant initial access to public and private interest groups. The
following section presents the case selection and the institutional context in Spain. Section five
outlines the experimental design, followed by the results, of the lobbying field experiment. The
following section complements these findings with an analysis of the novel elite survey,
completed by Spanish legislators, about interest group access patterns. The final section
discusses the significance of the chapter’s findings for the direction of future research.

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3.2 A Gap in Research on Interest Group Representation Bias

Research on interest representation bias seeks to explain which groups, under which
conditions, receive a preferential treatment from legislators (Gray & Lowery, 2000; Rasmussen
& Gross, 2015). Most studies suggest the type of interests an organization represents is related
to its level of political access. Specifically, private economic organizations are predicted to
enjoy greater access than nonprofit public interest groups because of their financial ability to
acquire political goods. This is also seen as the trend in European democracies with strict
campaign-financing regulations (Beyers, 2004; Beyers, Eising, & Maloney, 2008; Bouwen,
2002; Coen, 1998; Dür & Mateo, 2012; Lowery & Gray, 2004; Eising, 2007). However, most
of the literature looks at incumbent interest groups that frequently participate in the policy-
making process, while scant research has explored the conditions under which newly
petitioning organizations successfully obtain initial access to legislators.
Exploring the effect of group type on an organization's initial political access has a
twofold purpose. First, it can provide novel insights about the potential sources of interest group
representation bias by testing if legislators display systematic preferences to engage with a
certain type of group, even at the initial stages of the policy-making process. Political access is
a “golden standard” in lobbying practice, a central organizational goal for interest groups, and
a key antecedent to influence (Dür et al., 2015; Dür & Mateo, 2016; Levine, 2009; Wright
1996). Therefore, how, and which entities have a greater ability to successfully connect with
their target legislators has important implications for the overall policy-making process.
Second, initial political access is a common yet under-researched phenomenon that can
improve our understanding of the type of incentives legislators have to grant access to interest

74
groups. Western democracies have seen a constant yearly increase of politically active
organizations competing to enter the legislative institutions (Bitonti, 2017; Gray & Lowery,
2000). This means policymakers are more and more frequently approached by organizations
with which they have not engaged before. First-time meeting requests are part of the legislator's
routine at the beginning of the legislature, during the legislative agenda-setting process, when
a policy proposal is introduced to the floor, when a legislative committee appoints new
members, etc. Nonetheless, it is still unclear what determinants shape which "outsider"
organizations can secure a connection with their target policymakers.
Granting access creates opportunity costs for elected representatives, as they only have
the time to engage with a subset of all the interest groups that contact them (Dür & Mateo,
2016; Felli & Merlo, 2006). For newly petitioning organizations, defined as those groups that
directly contact a legislator for the first time, the entry barriers are higher because legislators
face greater uncertainties about the type or number of political resources that these
organizations might be able to offer. Nonetheless, the progressive increase in the interest group
ecology shows that entities that are normally outsiders to the policy-making process still
manage to enter the policy arena. Understanding under which conditions legislators grant initial
access, conditional on the type of interests an organization represents, is the key motivation of
this chapter.

3.3 A Theory on the Effect of Interest Type on Initial Political Access

Office-motivated policymakers have the incentive to meet with interest groups that can
offer political goods that will increase their chances of reelection and that will reduce their

75
uncertainties during the policy-making process (Austen-Smith, 1993; Hansen, 1991; Hall &
Deardorff, 2006; Wright, 1996). In European countries with publicly financed campaign
systems, the most valuable goods that interest groups can offer to legislators are technical
expertise and information about their constituents' preferences (Bouwen, 2004; Maloney, et al.,
1994; Esterling, 2004).
The main challenge for legislators is overcoming the uncertainty about which of all the
newly petitioning interest groups represents a greater political opportunity. Given the time and
resource constraints to gather and contrast information about each organization, legislators will
most likely assess the potential value of engaging with the petitioning organization by relying
on the content of the meeting request, such as the entity's type of industry, socio-economic
sector, their legislative oversight on the entity’s activities, its number of employees, etc.
Specifically, the type of interests an organization represents allows it to make important
inferences about its political goals (i.e., public or private), and the type of information it might
offer (i.e., constituent preferences or technical knowledge).
This chapter argues that nonprofit public interest groups are more capable of obtaining
greater initial access because their social desirability and positive social reputation maximize
the legislator's political opportunity. Social reputation is defined as the set of beliefs and
perceptions about an organization’s capacities, activities, intentions, and mission (Carpenter &
Krause, 2012; Dafoe et al,.2014) to improve social well-being. Previous research already points
to a positive relationship between reputation and political access (Coen 1998, 2009; Bouwen,
2004; Werner, 2015). In the lobbying context, social reputation entails that the organization
will share truthful information and insight about constituent preferences (Coen & Katsaitis,
2013; Stevens et al., 2016; Zimmerman & Zeitz, 2002), that it will add legitimacy to the policy-

76
making process (Dür et al., 2015; Flöthe & Rasmussen, 2019; Klüver, 2013; Rasmussen &
Gross, 2015), and that it will help the legislator to be perceived as responsive to constituents
preferences (Ainsworth 1997; Bartels 1991; Berry & Howell, 2007).
All things being equal, public interest organizations are perceived as having a higher
positive social reputation than private entities (Bernauer & Gampfer, 2013) because they
advance general social interests and public goods provision; they are highly integrated into the
communities where they operate; they are expected to provide transparency and visibility for
their actions; they are less likely to engage in unethical behavior, and they have wider support
from the civil society. While private groups seek company-specific goods and deliver the
benefits of the lobbying process to their members, public interest groups are seen as pursuing
collective and non-selective goods, therefore not seeking profit, but social and environmental
justice (Berry, 2015; Coen, 1998). Due to the nature of their activities, nonprofit organizations
work closely with local communities, which enables them to aggregate and communicate the
citizen preferences of underrepresented constituents to which legislators rarely have access
(Coen, 2009).
Lastly, while the public distrusts the lobbying process because private economic
groups are seen as seeking influence through bribes (Cigler & Loomis, 2007; Harstand &
Svensson, 2011), public interest groups are perceived as selflessly advocating for legislative
fairness against private groups (Lang, 2012; Berry, 2015). This connects with the perception
that public interest groups are transparent and provide greater visibility for their actions (Burger
& Owens, 2010) therefore legislators can expect the public will learn about their
responsiveness. As policymakers have broader incentives to associate with and to place greater
trust in entities that advance public interests, instead of exclusively narrow private interests (Jia,

77
2018; Leech, 2013), nonprofit organizations are therefore predicted as gaining greater initial
access to legislators. This is summarized as follows:
H1: A public interest group will have a greater initial access to legislators than a
private interest group.
Conversely, the conditions under which legislators can maximize their political
opportunity by granting access to newly petitioning private organizations are more limited.
Compared to nonprofit public interest groups, private economic interests are not as capable of
supplying information about constituency preferences and carry the risk of guilt or stigma by
association as public opinion is not as supportive of these groups (Cigler & Loomis, 2007;
Harstand & Svensson, 2011). However, the ability to supply technical information becomes the
main asset of private interest groups (Dür & Mateo, 2016; Eising, 2009), particularly in Western
democracies where financial political contributions are heavily regulated. The argument is that
the main incentive for legislators to engage with a newly petitioning private interest group is
the prospect of obtaining technical expertise that will help them succeed in the policy-making
process (Drutman, 2015; Grossman & Helpman, 2001; Hall & Deardorff, 2006; Richter et al.,
2009).
In this regard, the granting of initial access is conditional on the relevance of the private
organization's technical expertise to the legislator's current policy priorities. If perceived as
relevant, the newly petitioning organization generates an opportunity to obtain issue-specific
information that other organizations might not offer. However, if the organization's expertise is
not perceived as politically salient, granting access generates a cost because it takes the time
away from engaging with other groups, potentially more capable of assisting in the current
policy-making process. This condition is summarized in the following hypothesis:

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H2: A private interest group will be granted initial political access conditional on the
shared policy domains between the organization’s issue-expertise and the policy-makers
legislative oversight through committee appointment.
In sum, while legislators can expect some form of political gains by engaging with a
newly petitioning nonprofit public interest group, the scope of this expectation in the case of
private groups is reduced to the salience of its technical expertise for the current policy-making
priorities.

3.4 Case Selection

To test if public or public interest groups gain greater initial political access, this chapter
presents two studies. First, it presents a lobbying field experiment implemented by partnering
with a nonprofit organization and a private business group. The second part of this project
introduces an original survey of national and regional legislators in Spain. Outlined in this
section is a brief presentation of the political context in Spain and the motivation to implement
the studies in this country.
Spain has been a democratic constitutional monarchy since 1978, joining the European
Union in 1986. The country has 17 one-chamber regional parliaments (1175 members), a
national Lower House (350 members), and an Upper House (265 members) that represent its
47 million citizens. It is a predominantly bi-party system, with the Socialist Party (liberal) and
the Popular Party (conservative) historically winning most of the votes. However, Spain’s
electoral rules have allowed for another 19 smaller parties to successfully participate in its
legislative institutions. Most of these parties represent specific regional constituencies but

79
identify along the ideological spectrum in their party manifestos and tend to systematically vote
in a coalition with one of the two majority parties.
Spain was chosen to implement this research project for the following reasons. First,
it has the main characteristics of most developed Western democracies, which increases the
generalizability of the findings. Like most European countries, Spain has a parliamentary
system with party discipline, where elected officials are appointed according to the D'Hondt
method of proportional representation. Second, Spain has strict limitations on campaign
contributions, like the regulations in Portugal, Belgium, and Finland. Since 2007, only
individual party affiliates, but not companies, cannot donate to the political party’s treasury,
and contributions to specific candidates are not allowed. Though this does not fully eliminate
the possibility of illicit contributions becoming a confounding variable in this project, there is
also no evidence to suspect that such illegal practices are common amongst interest groups in
Spain (Bitoni & Harris, 2017). Finally, in 2019, Spain held regional elections (May 26th) and
general elections (November 10th) which allowed for the entrance of 64% new representatives
into its legislative institutions. At the time when this project was implemented, legislators were
deciding on the policy priorities for the term, therefore the expectation was that they will be
more willing to meet with new interest groups.

3.5 Study 1: Lobbying Field Experiment

The lobbying field experiment tests, through causal inference, the effect of the
petitioning organization’s type of interests (private or public) on its level of initial access to

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legislators. The study was pre-registered and was approved by the Institutional Review Board
(IRB). The following subsections report the experimental design, along with the results.

3.5.1 Experimental Design
The lobbying field experiment was implemented in February 2020 by partnering with
a business group and nonprofit group in Spain. The organizations were chosen to fit the
following definitions. A public interest group is a nonprofit association, one that seeks general
social good where the achievement of these goods will not selectively or materially benefit the
membership of the organization (Berry, 2015). Conversely, a private economic interest group
is defined as an entity that concentrates the benefits of its lobbying efforts solely on its
immediate members. Therefore, these partnering organizations serve as a bundled treatment
that includes all the differences between public and private interest groups.
The partnering public interest group is a nonprofit network for social welfare issues and
human rights. The NGO's activities involve community projects on subjects such as access to
healthcare or food security. Although the organization's network has some projects at the
national and European levels it has a low institutional profile and low public visibility, given it
does not engage in lobbying, public communication strategies, social media, or large-scale
advocacy campaigns. The private partnering organization is a business group that provides
economic investments and technical assistance in the development and management of
renewable energy sources. Even though this company has some projects in small municipalities
across Spain and Europe, it also has a low institutional profile and public visibility. For instance,
the company only engages with local technicians and has never launched a marketing campaign
to advertise its services or lobbied for a specific policy.

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Both the business group and NGO network are mostly comparable in terms of their
lack of lobbying experience and institutional exposure, the regions where they operate, and the
size of the organization in terms of employees/volunteers. Their main difference comes from
the industry classification of their socio-economic sectors, which is acknowledged as a potential
shortcoming when comparing the treatment effects between the groups.
Nonetheless, these differences are minimized in the treatment conditions because the
most salient difference between the organizations was their social-nonprofit or business-
economic profile. After all, the project is concerned with about how the group’s broader type
of private(economic) or public(social) interest might affect its initial political access, not about
the access variation within the same sectors. The content of the meeting requests reiterated the
social or economic impact of the organization in the regions in which they operate. Furthermore,
very limited information was given about the exact activities that the organization engages in,
and rather highlighted their social or economic purpose. The content of the meeting request
placed these entities on either side of the private-economic versus public-social divide.
Therefore, this salient difference is what makes the comparison between the treatment groups
possible.
A total of 400 Spanish politicians were randomly assigned to be contacted either by the
business group or the NGO group. This involved block randomization by legislator’s ideology
and gender from an original pool of 1402 regional and national representatives. This pool was
created in February 2020 by accessing the publicly available contact information from the
regional and national parliaments' web pages. The legislators were coded as liberals (left wing)
or conservatives right wing) based on their party's political and ideological position, using as a
reference the Spanish Center for Sociological Studies and previous research (CIS Barometer,

82
2020; Marcos-Marne, 2020; Vidal, 2018). The final pool contained 290 liberal female
representatives, 302 conservative female representatives, 350 liberal male representatives, and
460 conservative male representatives. For feasibility reasons, only 28.5% of the politicians
were randomly assigned to be contacted by the partnering organizations.
Figure 3.1 contains an English translation of the meeting request emailed to the Spanish
representatives. While preserving the anonymity of the organizations, lobbying experts were
consulted on the content of the emails to ensure their external validity. Therefore, the petitions
resembled as much as possible a standard firs-time meeting request. Each of the representative
was assigned to receive just one email, sent either by the public interest NGO group or the
private economic interest business group. Both meeting requests follow the same structure; a
brief introduction of the organization’s social/economic activity and a request to schedule a
meeting to further talk about the organization's social/economic projects in the legislator's
region.
The information about the petitioning organization was manipulated so that either the
private economic interests or public social interests were the organization’s most salient feature.
Therefore, group type was the most salient component of the economic or social treatment
conditions. The request signals to the legislators that the organization has a potentially relevant
social or economic impact their constituents’ region. The emails were signed by the respective
entities' directors, both having Spanish male names. No attachments or web page links were
provided in the email. Potentially the legislator or staff member could do an internet search of
the organizations. As previously mentioned, both have a minimal online presence, only with a
simple webpage and no social media channels.

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Figure. 3.1. Meeting Request Sent to Spanish Legislators by Treatment Groups

The two key independent variables of interest are organization type and issue-related
expertise. Issue-related expertise is coded as a dichotomous variable that indicates whether the
elected representative has legislative oversight on the petitioning organization’s activity
through the membership in a committee that legislates over issue domains and policies that are
directly related to the organization's socio-economic sector and industry. The main control
variables and the legislator's gender, ideology, and seniority. These are, respectively, coded as
male or female; liberal or conservative; and having served for more than one electoral cycle
(i.e., four years) in office.
The two outcome variables of interest are “email response” and “meeting acceptance”.
The first is measured as a dichotomous variable indicating whether the legislator responded to
the organization's email or not. The second, also dichotomous, is coded as a success if the

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legislator responded by either requesting or suggesting a date to schedule the meeting and as a
failure if the legislator declined the invitation.
The 400 meeting requests were sent during the third and fourth week of February 2020.
This was three weeks before any measures were approved regarding the spread of Covid-19.
For instance, the first politician who tested positive won as the 10th of March, and the first
national quarantine was issued by an executive order four days later. The legislative institutions
were fully functioning without any restrictions when the lobbying experiment was
implemented, though there is a possibility that, on average, response rate was lower than at any
other time of the year. Empirically, those legislators with a potential concern about scheduling
meetings were randomized in the treatment group assignment, therefore eliminating the
possibility that individual concerns might have biased the outcome of the experiment in a
systematic way.
The meeting requests were randomly assigned to be sent by either the business group
or the NGO on Tuesdays, Wednesdays, and Thursdays, with no follow-up emails. Sending the
emails in two consecutive weeks served several purposes. First, it prevented the servers from
blocking the organizations' email accounts, which is a common problem when a high volume
of emails is sent in a short time. Second, it reduced the chances of a spillover effect since some
legislators share staff members to arrange their schedules. If several representatives receive
similar emails from different organizations in the same day, this can generate a distrust that
negatively affects the response rate. This risk is reduced if the requests arrive spuriously to the
representatives’ inboxes. Finally, and in relation to the previous point, it protects the
organization's institutional credibility. While it is strange for an organization to send a high

85
volume of requests at once, it is a common practice to slowly reach out again as these are
accepted, rejected, or simply ignored.

3.5.2 Results
This section presents the results of the field experiment by running an ANOVA
difference of means test and OLS regression models. Table 3.1 reports the differences in the
response and acceptance rate by treatment group. A total of 9.75% of the 400 legislators
responded to the emails: both the NGO and the business group had a similar response rate.
However, the meeting acceptance rate was 4.5% points higher (p < .07) for the public interest
group. All the politicians that responded to the NGO’s emails accepted its meeting request,
while less than half of the legislators that responded to the business group did so. This provides
support for the first hypothesis, consistent with the theory that representatives prefer to grant
initial access to nonprofit public interest groups because their higher social reputation
maximizes the legislator’s political opportunity.

Table 3.1. Acceptance and Response Rate by Treatment Group

Table 3.2. reports the difference in acceptance and response rate for each group based
on their issue expertise, operationalized as a shared policy domain between the legislators’

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committee membership and the organization’s socio-economic sector. The second hypothesis
predicts the private interest group will have relatively limited access to legislators and will only
schedule meetings conditional on the relevance of their issue expertise and information
resources for the legislator’s current policy priorities. The meeting response rate was 8.64%
points higher (P < .02) and the acceptance rate was 12.7% points higher (P < .09) for members
of committees with legislative oversight on the private group's business activity. Conversely,
issue expertise is not related to the response to or acceptance rate of the NGO's meeting
requests.
The results provide support for the argument that a newly petitioning organization’s
access will be conditioned by to legislator’s opportunity cost assessment. If legislators do not
infer an immediate relevance between a private group’s issue expertise and their policy work,
they have lower incentives to grant initial access. In the case of a newly petitioning nonprofit
group, its positive social reputation provides greater guarantees the legislator will obtain
political gains, regardless of legislative oversight or shared policy domains. As such, the NGO
successfully scheduled meetings with all the legislators that responded to its request.

Table 3.2. Acceptance and Response Rate by Treatment Group and Legislator's Committee

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An interesting question is why a legislator would respond to the private group’s email
simply to decline the meeting request when having the alternative of avoiding responding
altogether. A qualitative assessment of the rejection emails shows that the politicians either
suggested being contacted in the future (without specifying when or explaining now is not a
good time) or that the entity should talk to a member of another committee, arguably more
aligned with its business activities. An example is the response of a member of an economic
and entrepreneurial committee forwarding the contact details of the spokesperson of the energy
committee. This second type of response further strengthens the argument that issue-related
expertise is the main incentive that policymakers must engage with newly petitioning private
economic groups.
It is up for debate if legislators show this form of responsiveness due to a sense of
public duty, or because they want to have a good standing relationship with the organization in
case its expertise can be useful for future policy priorities. No tracking system was placed with
the request emails; therefore, it is not possible to know whether the legislators that did not
respond lacked interest or simply did not receive the email (i.e., the parliament’s servers
discarded the organization’s email as spam). Nonetheless, this does not confound the results,
given the legislators with a potentially stricter server were randomized in the treatment group
assignment. Aside from committee membership, no other legislator's attributes are found to
have explanatory power over the organizations’ initial access patterns. Interestingly, previous
research would point to the importance of ideology for interest group representation bias, such
as in theories of issue-ownership, where parties build a reputation around engaging with specific
policy domains with a clear ideological distinction (Green & Hobolt, 2008; Petrocik, 1996).
However, the response and acceptance rates amongst liberal and conservative legislators are

88
similar for each group's treatment. Therefore, ideology might be a relevant factor in interest
representation bias at later stages of the lobbying process, but it does not help predict initial
access.
Focusing on Table 3.3, though the NGO and the business group received a similar
number of responses, a shared issue domain between the legislator’s committee membership
and the private interest group's economic activity increases the probability of response by
12.9%. Conversely, the interaction effect between an NGO treatment and issue expertise shows
a negative relationship. In other words, issue expertise does not increase the probability of a
legislator’s response in the case of the public interest group. The rest of this section reports the
OLS results for response (Table 3.3) and acceptance (Table 3.4) rate as dependent variables,
corroborating the results from the ANOVA tables. The business group is the baseline category
for all the models. Linear models can still be used for experimental design given randomization
does not justify logistic regressions (Freedman, 2008).
Table 3.4. reports the OLS results for meeting acceptance as a dependent variable,
having the business treatment group as a baseline category. Consistent with the first hypothesis,
the probability of legislators accepting a meeting request is 4.5% points higher for the public
interest group. In line with the second hypothesis, the likelihood of legislators scheduling a
meeting with a private group is 8.4% points higher when they are appointed to an issue-related
legislative committee. No other independent variables provide explanatory power to the model.
In conclusion, the results from the field experiment confirm this chapter’s research hypothesis
regarding the conditions under which public and private interest groups are granted initial
access to legislators.

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Table 3.3. OLS Response by Treatment

Table 3.4. OLS Results Predicting Legislative Acceptance to Interest Group Request

90
3.6 Study 2: Original Elite Survey on Interest Group Access
One alternative mechanism that would explain the results of the experiment is the
potential difference between the number of petitions that private economic groups and non-
profit public interests submit to legislators. Arguably, if the petitions from public interest groups
are less frequent, legislators could have a greater interest in granting access to this type of
organization to address this concern, the second part of the project involves an original survey
with policymakers have a general understanding of the patterns of interest group access in
Spain.
The elite survey was sent to the email account of a pool of 1402 national and regional
legislators during the last week of June 2020 and had a 10% response rate. Such a response rate
might be seen as not representative of the whole population of legislators, but it does serve to
provide useful insight for this project. Legislators were asked to respond based on their
recollection of their weekly activities before policies related to Covid-19 (starting March 10th)
altered their normal working schedules. Three main conclusions can be drawn from this survey;
the proportion of meeting requests from public and private interest groups is comparable; public
interest groups tend to petition liberal legislators slightly more often; and legislators grant
access to the petitioning groups when their relevant issue expertise match the policy-making
priorities.
In aggregate terms, most representatives (57.34%) reported that one-fourth of meeting
requests come from private economic interest groups, while 49.65% reported that another one-
fourth comes from public interest groups. The responses are constant across national and
regional legislators. However, disaggregating the responses by the legislators’ ideology reveals
some interesting differences. Specifically, for 27.91% of the liberal legislators, three-fourths.

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requests come from public interest groups, compared to conservative legislators. Likewise,
61.63% of liberal legislators report that only one-fourth of requests come from private groups,
compared to the conservatives. Finally, 24.4% of liberal representatives have never received a
meeting request from a private interest group.
These findings suggest the following discussion. First, the slight variation between the
legislator's meeting requests based on ideology potentially indicates that interest groups
perceive certain policymakers as “natural” allies, compared to the rest of policymakers
(Baumgartner & Mahoney, 2002; Hall & Deardorff, 2006; Kollman, 1997). In this case, it could
be argued that nonprofit groups perceive those allies to be liberal legislators. This would be
consistent with theories of issue-ownership, arguing that constituents identify political parties
to be competent with certain policy domains. For instance, social welfare issues are associated
as handled by liberal parties, while conservative parties are associated with regulating economic
issues (Walgrave et al., 2012). Second, and most importantly, it provides support for the claim
that, if public intenerates can secure greater initial access, the mechanism is not a difference in
the volume of the meeting requests they might send, compared to private economic interests.
Surprisingly, finding that legislators receive a comparable volume of meeting requests across
groups challenges the expectation that public interest groups do not pursue direct lobbying as
much as private organizations (Dür& Mateo, 2012).
It is important to acknowledge that a potential social desirability bias might have
influenced the way the legislators chose to answer the survey. This is a common challenge for
questions that involve socio-politically sensitive issues (Bailer, 2014; Grimm, 2010). Even
though the legislators were assured the responses would be treated anonymously, they might
still have had self-presentation concerns. However, this concern applies not only to this study,

92
but to the overall research on interest group representation bias that relies on survey self-reports
(i.e., Baumgartner et al., 2009; Beyers, 2004; Beyers & Braun, 2014; Chalmers, 2013).
Therefore, this survey still provides a useful insight into the patterns of interest group access in
Spain.

3.7 Conclusion

Interest group representation bias has important practical and normative implications
for representative democracy (Chalmers, 2013; Schattschneider 1960; Schlozman et al., 2012).
One of the central questions is whether the type of interests and organization represents affects
its political access, specifically, when looking at private economic interest groups and nonprofit
public-interest groups (Alves, 2020; Dür & Mateo, 2016; Fraussen, Beyers & Thomas, 2015;
Gilens & Page, 2014; Drutman, 2015; Hindmoor & McGeechan, 2013).
Regardless of the relevance of this issue, scant research provides a causally identified
estimate of the effect that the characteristics of organized interests have on its political access.
Furthermore, while most studies have focused on incumbent groups that regularly lobby, little
scholarly attention has looked at how newly petitioning organizations, outsiders to the policy-
making process, manage to access legislators for the first time. The current chapter addresses
this research gap by providing a novel theory on interest group initial political access, and by
testing its predictions through a lobbying field experiment by partnering with an NGO network
and a business group, and through an original elite survey with legislators in Spain.
Granting political access to an interest group creates opportunity costs for policymakers
(Dür & Mateo, 2016; Felli & Merlo, 2006). According to conventional wisdom, policymakers

93
prefer to engage with private economic interests due to their material facility to mobilize
political goods, such as technical information and expertise (Coen 1998, 1997; Dür & Mateo,
2012; Lowery & Gray, 2004). However, the determinants of political access are very different
for newly petitioning organizations due to the great uncertainty that legislators face regarding
the potential political gains that these new entities are likely to offer.
This chapter argues that the interstress of an organization represents the most important
piece of information that the legislator needs to assess the potential political value of engaging
with the newly petitioning interest group. Specifically, nonprofit public interest groups are more
likely to enjoy a greater initial access because their positive social reputation maximizes the
representative’s political opportunity and guarantees of obtaining political gains. Conversely,
private economic interest groups do not offer such guarantees and are predicted to be granted
initial access conditional on the relevance of their technical issue expertise for the legislators’
current policy priorities. (Bouwen, 2002; Beyers, 2004; Eising, 2007; Beyers, Eising, &
Maloney, 2008).
The project’s original elite survey, sent to 1402 national and regional legislators,
provides the following findings: both private and public interest groups a similar number of
meeting requests to legislators per week, and public interest groups end to petition more liberal
legislators than conservative legislators. The lobbying field experiment was implemented by
partnering with two organizations, which emailed a formal first-time meeting request to 400
legislators, assigned through block randomization by gender and party ideology. These requests
had an overall 9.75% response rate. Results show that the nonprofit public interest group was
more successful in scheduling meetings than the private interest group (4.5% points higher)
regardless of the legislators' committee membership. However, responses to the email and

94
acceptance of the meeting request for the private business group were 12.7% and 8.64% points
higher, respectively, for issue-related legislators, compared to policymakers without legislative
oversight over the business activity.
The findings suggest the following discussion. First, they challenge the conventional
expectation that private economic interest groups enjoy systematic preferential treatment from
legislators. Consistent with this chapter’s theory, the field experiment shows that a nonprofit
public interest group is more likely to gain initial political access than its private economic
counterpart. This encourages scholars to identify other forms of testing how the relationship
between newly petitioning access interest groups and legislators differs compared to incumbent
private interest groups. Second, they invite us to further examine political access from in a
comparative perspective: the chapter shows that in institutional contexts where private
campaign contributions are heavily regulated, the determinants of political access give a
comparative advantage to nonprofit organizations.
It would be interesting to replicate this study in other countries, such as the United
States, where campaign contributions play an important role in interest group dynamics. Third,
the findings suggest two new puzzles for future research. One is the tension between public
interest groups having greater initial access to legislators, and how other studies find
representation bias tends toward advancing the interests of business at the later stages of the
policy-making process (Dür et al., 2015; Schattschneider, 1960; Schlozman et al., 2012). In
other words, it is important to identify at what point the in-lobbying process public interest
groups lose their political advantage and why. The other puzzle refers to the role of ideology in
the patterns of interest group access. Specifically, explaining why certain types of organizations
contact legislators from a specific ideology more frequently, given that most legislators display

95
similar behavior when granting initial access. The original elite survey reveals that liberal
legislators tend to receive more petitions from public interest groups while the experiment
shows that conservative legislators are as responsive as liberal legislators. Therefore, future
research could further explore what legislator-level attributes motivate interest groups to
perceive certain legislators as “natural allies” and why.
Lastly, the results have important policy implications regarding the positive effect of
social reputation on political access. This study builds on previous research on the role of
reputation in firms’ political strategies (Coen, 1998, 2009; Bouwen, 2004), which recently finds
that socially responsible companies have greater access to legislators than their peers (Werner,
2015). The current project goes a step further by showing social reputation not only matters for
within-sector access but that also shapes political access across interest group types. Therefore,
practitioners should underscore the importance of developing a clear corporate social reputation
plan to complement the implementation of their political strategies. In the case of nonprofit
public interest groups, these findings should encourage them to engage in direct lobbying tactics
more frequently, given their success in securing meetings with legislators.
To the best of my knowledge, this is the first study to successfully isolate a petitioning
organization's type of interest (private or public) from the legislators' decisions to schedule a
meeting. Through this method, it is possible to causally compare the differences in the interest
groups’ connections to legislators and identify any initial political access bias. By partnering
with two organizations that never lobbied before, the project tests, for the first time, how newly
petitioning organizations can enter the legislative institutions. The novel findings reveal that
situations of initial access petitions can be seen as one condition under which nonprofit public
interest groups have a certain political advantage over private economic groups. The natural

96
next step is for future research to develop new theories and empirical strategies to identify other
instances that might reveal similar political patterns.
In a context of growing interest group formation, legislators inevitably will have to
decide which newly petitioning interest groups provide a political opportunity and should be
granted initial access. Such a situation is particularly common at the beginning of the
legislature, after new committee appointments, or as new policies are introduced for
deliberation. Though initial access does not guarantee political influence, it is a necessary first
step for any organization that wishes to participate in the policy-making process, therefore its
significance should not be underestimated. Hopefully, this project inspires scholars to revisit
some of the assumptions around interest group representation bias and to further explore the
antecedents of interest group political access, along with the legislators’ decision-making
process when engaging with newly petitioning interest groups.

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Conclusion

The interaction between business interests, political elites, and civil society is a puzzle
that has produced some of the most prolific research in political science. The preceding chapters
have looked at three key dimensions of the relationship between these actors. Namely, (1) how
firms can leverage their market capabilities to secure and increase their political capabilities,
(2) how firms can strategically engage in sociopolitical corporate activism to increase their
market power, and (3) the conditions under which public interest groups have greater initial
access to legislators compared to business interest groups.
The dissertation makes several theoretical contributions to the field. First, focusing on
business interest -government relations, the dissertation outlines the mechanisms through which
firms can develop political capabilities, which empirical research shows are key in determining
of firm’s corporate political activities such as lobbying. Specifically, my contribution highlights
how market-based capabilities positively influence how firms develop their political capabilities
via two mechanisms: by increasing the cost-effectiveness of engaging in corporate political
capabilities and by capturing the value of firm-level-specific competencies.
Second, looking at business interests – civil society relations, I highlight how firms can
strategically engage in corporate sociopolitical activism to increase customer support while
reducing the backlash of citizens with opposing views. Civil society will screen firms’
engagement in corporate sociopolitical activism through the type of actions (i.e., substantive or
symbolic) and type of role (i.e., pioneering or follower) which will affect their decision to
reward the firm through intentional purchase (buycott) or punish it by the avoidance of purchase
(boycott). Third, looking at civil society – government relations, I argue that initial access to
legislators is greatly determined by whether the interest group represents public or private

98
interests. I posit that nonprofit public interest groups enjoy an initial political access advantage
because their social desirability and positive social reputation maximize the legislator's political
opportunity.
In terms of methodology, this dissertation has contributed to the field by implementing
both a survey experiment and a field experiment. Through the survey experiment, I am able to
identify the causal effect of firms taking sociopolitical stances on issues largely unrelated to
their core business activities on consumers' purchase decisions (i.e., boycott and boycott).
Through the field experiment, I can causally identify the initial political access that NGOs and
business interests have to legislators in Spain. This field experiment overcomes one of the main
challenges in social sciences research; the endogenous selection of entities into the lobbying
process, and the endogenous selection of citizens to consume a firm’s products. Neither of these
processes is random events, therefore research could easily procure biased results due to self-
selection being correlated with the outcomes.
Empirically, this dissertation has shown the asymmetry in consumers’ reaction to
different forms of corporate sociopolitical engagement through real economic stakes, therefore
addressing a clear research gap regarding critical factors that moderate boycotting and
buycotting responses. Therefore, the findings carry strong strategic implications for firms and
strongly contribute to the political consumerism literature, as it is one of the few studies that
simultaneously examine how boycotting and buycotting responses from consumers vary in
different ways under the same condition. This dissertation has also provided a causally identified
estimate of the effect of an organization's type of interest on achieving initial political access in
a Western European democracy such as Spain. It provides support for previous research on the
relationship between reputation and political access by showing how civil society groups enjoy

99
greater initial access to legislators when petitioning a first-time meeting, compared to the access
of private interest groups.
I hope this dissertation serves as the basis of future research looking at the relationship
between business interests, political elites, and civil society. First, by empirically testing the
theoretical argument put forward in this dissertation about which factors help firms implement
cost-effective corporate political activities by integrating market capabilities and political
capabilities. Second, future research should further examine the mechanisms that explain
consumer responses to a firm’s actions. It should also identify ways in which firms can choose
how to strategically engage in corporate sociopolitical activism to increase positive attitudes
towards the firm while reducing the backlash from ideologically misaligned consumers. Lastly,
research could further explore the patterns of initial access of interest groups to legislators.
Relatedly, it should examine at what stage in the policy-making process we observe the political
advantages public interest groups lose influence compared to business associations. Lastly, it
could examine the varying importance that legislators' ideology can have on predicting which
interest groups they associate themselves with.

100
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Creator Dominguez Perez, Maria (author)

Core Title The strategy of firms towards political elites and consumers in polarized western democracies

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Publication Date 10/19/2022

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