The long shadow of lobbying: ideational power of lobbying as illustrated by welfare profits in Sweden

Abstract
The weak correlation between lobbying and policy outcomes is puzzling. The main argument developed here is that the puzzle is partly caused by a lack of attention to the long-term effects of lobbying on the ideas espoused by policymakers. An analysis of ideational power goes beyond the usual empirical focus on the immediate effects of lobbying. Thus, it provides a more complete understanding of how lobbying pays off. To illustrate this, the paper analyzes the battle over profits in the Swedish welfare sector. Despite a strong public opinion in favor of a cap on profits, the industry got its way. To justify this, policymakers relied on the argument that a cap on profits would drive out private welfare providers and, thereby, undermine choice for service users. In other words, the idea that private entrepreneurship, choice, and individual liberty are inextricably linked is a key factor in explaining the outcome. This idea had taken root among policymakers in Sweden following a massive and costly lobbying campaign, organized by the business community, several decades earlier. The main takeaway is a focus on the here and now risks underestimating the efficacy of efforts to influence policy. 

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