Many decisions that affect economic life are not made in markets but in political processes. The research in this project aims at improving our understanding of how these processes work. In particular we investigate how the institutional environment in which policy is made shapes the outcome of the political processes. In doing this, we consider formal influence channels (such as elections and referenda) as well as informal ones (such as lobbying). The project also studies the related issue of how different political institutions can handle credibility problems in economic policy. Both theoretical and empirical approaches are employed. In the theoretical work, special emphasis is put on the role of information. Among the specific issues that are investigated are:

• influence attempts through strategic information transmission
• the political economy of infrastructure allocation
• electoral competition with privately informed political candidates