Rent Seeking and the Common Agricultural Policy: Do member countries free ride on lobbying?
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The Common Agricultural Policy is modelled as a club good providing the European
Union (EU) farmer with financial benefits. We build an economic model which explains
how much farmers in individual EU countries invest in rent-seeking activities in order to
test for free-riding behaviour on lobbying costs. For our investigation we group the EU
member countries by farm structure, and the type of benefit received. We explain the fees
paid by farmers for lobbying by other countries fees, political variables, and country and
regional agricultural characteristics. The model shows that some member countries free
ride on others. This suggests a form of policy path dependency and leads to a suboptimal
investment on lobbying of 7.5%.