City vs. State: Why Local Governments Lobby Washington Despite Incongruent Needs

Cities are active interest groups lobbying the federal government, yet this intergovernmental interaction remains poorly understood.

The Core Argument:

We contend that when a city's preferences diverge from its parent state government's priorities—a situation termed preference incongruence—cities turn to the federal level for more resources. This divergence can lead to underprovision of certain public goods at the local or state level, creating an incentive for cities to seek federal solutions.

Our Evidence:

We analyze over 13,800 lobbying disclosures submitted by U.S. cities (with populations exceeding 25,000) between 1999 and 2012.

This data set reveals a strong correlation: income inequality and ethnic fragmentation within a city significantly influence its tendency to engage in federal lobbying.

How We Show This:

Using an instrumental variables approach,

we examine earmark spending and Recovery Act grants.

Our findings demonstrate that every dollar spent by cities on lobbying generates substantial returns—indicating effective resource mobilization strategies aimed at influencing federal policy.

Key Takeaways

• Research Scope: Intergovernmental relations, specifically city-state preferences divergence
• Data Source: City lobbying disclosures (1999–2012), U.S. cities ≥ 25k population
• Influencing Factors: Income inequality, ethnic fragmentation
• Methodology: Instrumental variables analysis focusing on earmark/grant data

This study provides crucial evidence regarding the fiscal dynamics and policy strategies employed by local governments in navigating complex intergovernmental relationships.