Special Interests and the Gains from Political Integration
This paper presents a formal study of economic influence by special-interest groups under political integration and separation. We first show that countries where more groups are organized to lobby gain from political integration on economic grounds. The reason is that a more organized country, under a political union, can affect policies in the other country to its advantage, something that a less organized country can do to a lesser extent. We then study the interaction of political integration and endogenous lobbying structure. We show that political integration affects the formation of interest groups. Moreover, if a country is more organized before political integration, this will continue to be the case afterward.
Daniel Brou and Michele Ruta. "Special Interests and the Gains from Political Integration" Economics and Politics 18.2 (2006): 191-218.