On the theory of political competition: Comparative statics from a general allocative perspective

It is a widely held belief that interest groups respond competitively to political challenges from other groups. This view is found not only in the traditional theory of interest groups, but also in the literature on policy typologies. Though it is not necessarily supposed that groups form in response to opposition, it is believed that when groups exist, they compete. If an interest group is thought of as a multipurpose organization, whose leaders might spend organizational funds on nonpolitical programs which directly serve the members, the supposition of competition can be subjected to rigorous examination. Political competition causes the cost of political success to rise. Since group leaders must allocate scarce revenue among projects, it seems that nonpolitical projects might become more attractive when the political environment becomes competitive. Political scientists have usually been disposed to take the opposite view, believing that demand for political activity rises as the cost of political success increases. The nature of political action as an organizational investment is discussed from the allocative perspective in this essay. It is shown that competition cannot be safely assumed unless other strong hypotheses are invoked. A Slutsky-type theorem is deduced for political reaction.