Journal #J-06/2000
A Guide to Extracting Information from Environmental Pressure Groups
Eric Nævdal & Richard J. Brazee
Department of Economics & Social Sciences Agricultural University of Norway PO Box 5033, N-1432 Ås, Norway http://www.nlh.no/ior/ e-mail: eric.naevdal@ior.nlh.no

1) Richard J. Brazee is at the Department of Agricultural and Consumer Economics University of Illinois at Urbana-Champaign
http://w3.aces.uiuc.edu/ACE/   e-mail: r-brazee@uiuc.edu

Nævdal, E. & R.J. Brazee (2000): "A Guide to Extracting Information from Environmental Pressure Groups", Environmental and Resource Economics, 16(1):105-119.

Abstract:
This paper examines the relationship between environmental pressure groups and environmental policy makers. Environmental pressure groups are assumed to possess valuable private information on environmental issues. Environmental pressure groups are also assumed to pursue their own preferences, which are only partially correlated with policy makers' preferences. A new aspect is that binding contracts with side payments are not allowed, which accurately describes the interaction between environmental pressure groups and governments. It is shown that by choosing probabilities of acting on environmental pressure groups' signals, a decision maker can force environmental pressure groups to reveal superior information even in the absence of binding contracts.

Key words: Asymmetric information, environmental decision-making, truth-telling.

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