In Esteban and Ray (1999) we formalize a model in which individuals lobby before the government in order to benefit from some productivity enhancing government action (infrastructure, direct subsidies, permissions, in short). The government honestly tries to allocate these permissions to the...

The Olson Paradox referes to the observation that larger groups may be less successful in furthering their interests. We address the paradox within an explicit game-theoretic model of lobbying.