Davin Raiha

• Raiha, D., 2018, "Economic Influence Activities", Journal of Economics and Management Strategy, October 27(4): 830 - 843.
  Abstract: Firms frequently make operational and market decisions to gain political influence. They locate plants, expand workforces, or support programs, with the aim of affecting the economy and, in turn, the electoral success of politicians. This behavior constitutes a non-traditional form of influence, which I refer to as economic influence activities. In this paper I show how such activities influence policymaking and why they may be preferred, by firms, to more traditional influence activities such as campaign contributions. What distinguishes economic influence activities is that a firms strategy choices affects the state of a local economy and, in turn, the evaluations that voters make of the performance of an officeholder. I show how firms can leverage this capability to extract subsidies and policy favors from incumbents.

  Link(s) to publication:

  http://dx.doi.org/10.1111/jems.12249

• Holburn, G. L. F.; Raiha, D., 2017, "Startups Are Turning Customers into Lobbyists", Harvard Business Review
• Callander, S.; Raiha, D., 2017, "Durable Policy, Political Accountability, and Active Waste", Quarterly Journal of Political Science, May 12(1): 59 - 97.
  Abstract: The policy choices of governments are frequently durable. From the building of bridges to the creation of social programs, investments in public infrastructure typically last well beyond a single electoral cycle. In this paper we develop a dynamic model of repeated elections in which policy choices are durable. The behavior that emerges in equilibrium reveals a novel mechanism through which durability interacts with the shorter electoral cycle and distorts the incentives of politicians. We find that a government that is electorally accountable nevertheless underinvests in policy, that it deliberately wastes investment on projects that are never implemented, and that the type of policy it implements is itself Pareto inefficient. The first two distortions match evidence from infrastructure policy in western democracies, and the third identifies a distortion that has heretofore not been explored empirically. Notably, these effects emerge solely due to the interaction of policy durability and political accountability, and not from corruption, poor decision making, or voter myopia.

  Link(s) to publication:

  http://dx.doi.org/10.1561/100.00016120

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