The episode you’re about to hear is being hosted by two of our student fellows. Our Student Fellows are a diverse and interdisciplinary group, representing colleges and specializations across the University of Nebraska. Our fellows, Izu Mbaraonye and David Ornelas invited professor Mirzo Abdurakhmonov on the show to explore the topic of lobbying. Abdurakhmonov is an Assistant Professor of Management at the University of Nebraska college of business, where he conducts research on corporate political activities, business-government interaction, and strategic leadership. The discussion in this episode delves into the basics of lobbying, political influence, and more.
Show Notes:
Strategic Risk and Lobbying: Investigating Lobbying Breadth as Risk Management
Unpacking Firm External Dependence: How Government Contract Dependence Affects Firm Investments and Market Performance
Congressional testimony as an indicator of firm political influence
When the Cat's Away, the Mice will play: A Model of Corporate Regulatory Compliance
The episode you’re about to hear is being hosted by two of our student fellows. Our Student Fellows are a diverse and interdisciplinary group, representing colleges and specializations across the University of Nebraska. Our fellows, Izu Mbaraonye and David Ornelas invited professor Mirzo Abdurakhmonov on the show to explore the topic of lobbying. Abdurakhmonov is an Assistant Professor of Management at the University of Nebraska college of business, where he conducts research on corporate political activities, business-government interaction, and strategic leadership. The discussion in this episode delves into the basics of lobbying, political influence, and more.
Show Notes:
Strategic Risk and Lobbying: Investigating Lobbying Breadth as Risk Management
Unpacking Firm External Dependence: How Government Contract Dependence Affects Firm Investments and Market Performance
Congressional testimony as an indicator of firm political influence
When the Cat's Away, the Mice will play: A Model of Corporate Regulatory Compliance
Disclaimer: This transcript is auto-generated and has not been thoroughly reviewed for completeness or accuracy.
[00:00:00] Elsbeth Magilton: This is Tech Refactored. I'm one of your regular guest hosts, Elsbeth Magilton, the Executive Director of the Nebraska Governance and Technology Center at the University of Nebraska. The episode you're about to hear is being hosted by two of our student fellows. Our student fellows are diverse at interdisciplinary group representing colleges and specializations across the University of Nebraska.
The goal of the Student Fellows Initiative is to familiarize students with the nuances of working with professionals from other academic back outs, incorporating their diverse perspectives and vocabularies in order to better inform their work. This semester we challenge them to produce an episode of Tech Refactored on a subject of their [00:01:00] choosing.
We hope you enjoy the special episode of Tech Refactored, hosted and produced by our student fellows, Izu and David.
[00:01:08] David Ornelas: My name is David Ornelas. I am a, uh, master's student studying integrated media communications at the College of Journalism and having my master's certificate in public relations and social media.
[00:01:21] Izu Mbaraonye: And thank you David. I'm Izu Mbaraonye, And I'm a PhD, PhD student at invested in Nebraska collegial business where I study strategic management with specific and emphasis on corporate political activities and social evaluations. Today we're joined by Mirzo Abdurakhmonov. Mirzo is an assistant professor management at invested in Nebraska collegial business where he conducts a section on corporate political activities, business government interactions, strategic leadership. Mirzo also teaches courses in strategic management.
I'm proud to joining the University of Nebraska. He anticipated from the University of Arkansas, and his Master in Business Administration from Henderson State University in Arkansas. Dr. Mirzo, welcome to the show.
Mirzo Abdurakhmonov: [00:02:00] Thank you very much for inviting me.
[00:02:03] David Ornelas: We would like to get into your work and expertise, uh, as well as the research you're currently conducting.
[00:02:08] Mirzo Abdurakhmonov: Can you please go into detail as you have, uh, made this introduction? I do research in a corporate political activity arena, particularly, uh, I investigate business government interaction. Uh, in the latest research, uh, I looked at how government contract. Thing impacts, uh, firm outcomes. I also do research on, uh, firm testimonies in Congress and how, uh, market reacts to such events.
Uh, in addition to that, more recently I looked at, uh, how, uh, firm risk, uh, profile leads to overall, uh, increase firm in a firm, a lobbying scope. So this is kind of some of the work that I am working and I've been working more recently. So
[00:02:50] Izu Mbaraonye: can you tell us what made you get into this kind of research? Like what made you first get impressed in it?
[00:02:55] Mirzo Abdurakhmonov: Uh, it is a, I think, a interesting, uh, question. Uh, in fact, uh, [00:03:00] originally I'm, uh, from USBA Stan and USBA Pakistan, uh, is. Most people will know is a former, uh, Soviet Union country. And there was a heavy hand, uh, of a government as I grew up, and most likely, this is not so much familiar to the audience in the United States, but uh, in, you know, many countries across the world, government has a critical role in, uh, overall societal outcomes.
So that was a natural exp natural interest for me as I was, uh, getting my BA in economics and. That was, I think, a nature, uh, continuation of that interest. So
[00:03:38] David Ornelas: there's a lot of, uh, I guess personal background. Any, any key elements that, uh, kind of piqued your interests within, uh,
[00:03:44] Mirzo Abdurakhmonov: your subject? Uh, interestingly, uh, when I was doing, uh, my undergraduate degree in economics, uh, I had a professor school on his last name and he was a, uh, libertarian or like a free market economy guy, [00:04:00] and he.
Preach a lot about, uh, how government is bad and how uh, it hinders, uh, certain activities in society and it naturally rose my interest. Like, is this, uh, government is really that bad? And when, you know, like times passed and one day I. Started, uh, doing my PhD, I could, you know, I just realized that the same questions could be, uh, answered from the perspective of, uh, of a firm, uh, which we cover in management.
He definitely scaled it up from there. Fascinating. Yes.
[00:04:37] Izu Mbaraonye: It's interesting that you bring up as Pakistan. I mean, um, of course there are different regulatory environments. So are there any similarities between his Pakistan and the US in terms of regulatory environment?
[00:04:47] Mirzo Abdurakhmonov: Uh, regulatory environment, I would say, as I have said earlier with Pakistan, is the more intrusive into like, interfering in a firm.
Activities and overall objectives, uh, where in the US is more laser fair [00:05:00] capitalism. So that's kind of in a nutshell. There are like, uh, uh, significant, uh, differences in my view. That's
[00:05:09] Izu Mbaraonye: interesting because I mean, so does it make it, um, I guess more interesting to study an environment that is quite different from Stan because means Stan has almost, uh, the regulatory environment becomes a constant in a way because you don't really, influencing is almost like a setting already.
Cause setting people have power over that. In the US there's almost like, um, like the genius in a way, like can't influence it. So like,
[00:05:35] Mirzo Abdurakhmonov: uh, yes and no in a sense. Uh, I would think, uh, obviously I would have, uh, and I do have plans, uh, to conduct, uh, some research in US Pakistan related to firm and, uh, government interaction.
But in the US context, we are very fortunate that there is tons of data that could be used and analyzed. And I think for that, uh, reason, uh, we as a scholars offer corporate political activity. We do [00:06:00] have some bias in terms of what is easiest, uh, availability of data and let's go and investigate, uh, and if I will, to do that specific activity in a case of Pakistan or.
Any other emerging economy, I think that would take a lot of resources because data is not easily available, unfortunately.
[00:06:20] Izu Mbaraonye: That makes sense. So today we invited specifically to discuss hard take businesses, use corporate political activities, specifically lobby, and what the outcomes maybe for businesses and as well as society.
So just to start off, can you tell us like, Tech industry, like how your lobby practices are overall, just in general
[00:06:38] Mirzo Abdurakhmonov: overview. Uh, in my thinking, uh, to be honest, and frankly, I don't claim to be an expert in a tech industry, but overall, like I do research on a corporate political activity and in my view and my thinking tech industry is no different from other industries.
And here, I would say the approach. Tech firms in, uh, in terms of trying to lobby or influence [00:07:00] government is like one objective is, uh, to stop impeding regulation that would, uh, interfere with their daily activities or second objective if, uh, regulation, uh, is gonna be in place no matter what. They need to make sure that the proposed or adopted regulation, uh, is, uh, beneficial, uh, to certain firms at the expense of others.
So literally, To carve out the unique benefits for specific firms in this regulation that is coming. So again, just to re that, there are two, I think, fundamental ways tech firms can influence government. One is to stop the legislation, which ideally they would want given. Tech industry largely operates in a laser fair environment and they want less regulation, obviously.
But if they cannot stop the legislation or regulation that's coming, uh, they most likely try to actually make sure that this regulation is, uh, most favorable to certain firms at the expense of [00:08:00] others. I see. , it's, That's very
[00:08:03] David Ornelas: fascinating. As, as somebody that's completely new to the understanding of how lobbying works, can you go into detail with just a little bit of the misunderstandings that society has about lobbying?
[00:08:16] Mirzo Abdurakhmonov: Absolutely. I think there is this a common sense. Misconception or like perceived, uh, misunderstanding of lobbying. It's generally associated with some form of a dirty activity. Uh, in reality, it is not actually, uh, lobbying is a legitimate, uh, means or ways, uh, to influence government and, uh, under lobbying, like some people perceive, okay, it's just stacking, uh, Tons of cash into suitcases and bringing it to a government officials or politicians.
But in reality, lobbying involves, uh, delivering information so they can persuade, uh, government officials to change their view or, uh, to act on a certain issue. Uh, in that sense, lobbying is a legitimate, uh, from the perspective of. [00:09:00] Way, uh, to, it's one of the ways to influence government and it's, uh, I think, uh, protected even by the US Constitution in terms of like, uh, ability to express a free speech and opinion to government officials.
Oh, so it's definitely
[00:09:14] David Ornelas: not just all evil, right?
[00:09:16] Mirzo Abdurakhmonov: Yes, yes.
[00:09:19] Izu Mbaraonye: The f c versus Citizens United Rights. It doesn't take 10 case law. Mm-hmm. . So, I mean, just going back to the idea of lobbying, like are there any particular agencies or government bodies that are more targeted for lobbying? Like, I
[00:09:32] Mirzo Abdurakhmonov: think it, it would depend on the purpose of influence.
For example, uh, if a firm even, I mean in this case, a tech firms are seeking, uh, government, uh, contracts. For example, they could target either Congress or uh, government. And again, uh, like government, federal agencies, and again, it depends whether, uh, government already wants to buy a certain product or not.
Uh, for example, interestingly, in the case of, uh, government contracts, if there is [00:10:00] no, like a particular demand firms target Congress. And the purpose of that is to generate a demand because they will go to Congress and they will say, uh, maybe, uh, Specific agencies would need this thing or that thing.
Let's, because it, it's useful like in this particular case, alternatively, for example, uh, they could go with the same, uh, quest to federal, uh, government agencies where they would tell them. Hey, there is this fancy product like I am developing or I came up with, and I think it would be of a very good use to you.
And in that case, uh, like the firm would specifically target federal government agencies. However, like if it's a regulation, uh, within the power of Congress, They would go to Congress, but if it's just, uh, interpretation or implementation of laws or regulations, uh, they can go to agencies, federal government agencies, they would be enforcing or making sure like how it is interpreted.
So, I mean, you've
[00:10:59] Izu Mbaraonye: already [00:11:00] talked about some of the benefits of loving that companies seek to achieve. You talked about winning contracts and changing regulations. So can you tell us more outcomes that businesses hope to achieve, like within the company?
[00:11:11] Mirzo Abdurakhmonov: Obviously, uh, I think I said a little bit earlier about this briefly, uh, there are certain benefit.
That tech firms in this case would be seeking from government, right? One would be, uh, it would be a federal government contracts. Uh, we know like, uh, I think the US budget annual budget is close to half a trillion dollars, I'm not mistaken. So there are tons of firms that actively, uh, seek those contracts.
Uh, second through lobbying tech firms can try to get subsidies. And we know, like with the recent tensions on a geopolitical level with China, there are a lot of, uh, firms, uh, that are trying to in-source their supply chain into the United States. And as a result, like, uh, you know, government is open, uh, to open to a lot of, uh, subsidized [00:12:00] activities that would not be possible like, say few years ago.
So that's the second outcome for tech firms would seek from, uh, government actively. Third, we briefly mentioned it's a regulation either. Making sure that regulation is not enacted, or if it is enacted, it's, it benefits certain firms at the expense of others. So
[00:12:21] Izu Mbaraonye: we read one of the papers, right, where you talk about how being embedded with the government can make you almost lazy in terms of innovation.
So in. That sounds like one of the best sides of lobbying. So are there other bad sides that
[00:12:35] Mirzo Abdurakhmonov: firms can face from lobbying? I mean, I think that's a very interesting question and there are like, uh, pros and cons with the firm approach to political activity overall lobbying. On one side you could argue yes.
Lobbying would bring direct benefits in terms of like maybe it's government contract subsidies or making sure there is this favorable regulatory landscape. But on the other hand, some scholars would argue [00:13:00] that Gov corporate political activity and lobbying in that case would have some inertial tendencies.
So for example, if tech firms would start, uh, investing a lot of money into, uh, lobbying activities or into corporate political activities, they lose, uh, focus, uh, from market activities that they are doing. So in a sense, uh, There, there could be two things. One is like a simple initiative executive level where they would say, Why don't I have to invent another product while I could just invest in a lobbying and get the outcome that I want?
And the second is actually once firm starts, uh, lobbying and engaging in corporate political activity for certain executives within the firm, politically connected executives or the executives who are involved in, uh, dealing with government, they gain more power. As a result, they would start, uh, pulling, uh, even greater share of resources of a firm towards these activities because, uh, that's their expertise, that's their arena that's [00:14:00] bringing a benefit personally to them.
So in that sense, like, uh, there is a research, uh, interesting textbook by, uh, ment, I think from 2015, if I'm not mistaken, over there. Like he, uh, looks at interesting phenomena. For example, he would say, Uh, if you look at s and p 500, uh, once one, these firms establish their, uh, corporate offices in Washington dc which is a political power center for the United States.
Uh, these firms rarely leave, meaning that, you know, they would have this stable budget and it tips increasing, but not decreasing. Just so was on the rise. Yes. It, I mean, I like over here, we should be a little, uh, delicate with that question. It's not on the rise to, in a significant level, but, uh, there is this, uh, incremental increase in that, in that sphere.
That's an interesting
[00:14:54] Izu Mbaraonye: point. So that means even. From the lobby perspective, there are people who you, I'm guessing you hire [00:15:00] lobbyists right? To lobby for you. So that means they incentivized to just keep lobbying. Like that's why the big offices and this, they just keep going and going even if you don't any
[00:15:08] Mirzo Abdurakhmonov: benefit from it.
Right? Exactly. Exactly. And I think interestingly, that book that I mentioned would uh, make your point that these politically connected revolvers or lobbyists, you would say they will learn a way how to sway executives. Uh, to get more money. They, I mean, even with no direct benefit, uh, from specific activity, because interestingly, from a corporate political activity, you can get two, two types of benefits or two categories.
One is stop, uh, bad things from happening and a second get something positive. Right? And a lot of times, revolvers and lobbyists would say, Uh, there, look, there is no direct benefit that you see, uh, for the bottom line of the firm, but I'm, uh, helping a lot of bad things from happening. So instead of like, uh, having this negative [00:16:00] impact, you, you really don't see it.
And for that reason, just give me more money in the next quarter and the next year, uh, as part of my budget. So, full enough with this
[00:16:09] Izu Mbaraonye: same question, of course, uh, from what you say, right? . If I was a company in the tech industry, for example, less on Facebook or Met as they go now, and Google Lobby is the government, then what is my incentive to lobby the government to, if they're changing the laws that apply to all of us.
[00:16:26] Mirzo Abdurakhmonov: So what you are saying, what if your incentive if Facebook or Google is engaged living,
[00:16:32] Izu Mbaraonye: right. It seems like the, the, uh, benefits are mostly common benefits, public benefits. It benefits everybody in the same environment. So why do I need to spend my own
[00:16:41] Mirzo Abdurakhmonov: money to do it? Uh, I think, uh, that's interesting. Uh, point you are bringing, uh, the, I think you are bringing the phenomena of, uh, Of collective action problem.
And that thing, uh, often happens in a sense. You would, you could argue that, okay, these large firms, tech firms are [00:17:00] engaged in lobbying. So if I'm a small entrepreneur in the same industry, I don't have to get involved. And what is the incentive for me? Right? Yes. Uh, actually this collective, uh, Action problem would suggest that even though like, uh, the benefits are incurred to all the players in that field, given my share size, for example, in that case it's a size of meta in the size of Amazon or size of Google, I would disproportionally benefit from that specific legislation that's beneficial to all.
And for that sake, even though I know other smaller players are benefiting from my activities, I will continue to do that. That's a logic they would have
[00:17:42] David Ornelas: at the end. It benefits them either
[00:17:44] Mirzo Abdurakhmonov: way. Yes, it benefits them either way, but given the sheer size that I have, I'll get greater benefit than these smaller players.
We'll be right back
[00:17:56] David Ornelas: to discuss how corporate political activities impact society [00:18:00] momentum
[00:18:01] Mirzo Abdurakhmonov: it's building at the University of Nebraska Lincoln. With game changing work in precision agriculture, nanoscience and digital humanities, we're unlocking mysteries in brain research, solving the impossible with remote surgery using robots, and we're creating bold futures with world leading research in early childhood Educat.
We don't slow down and we are not letting up. We are Nebraska.
[00:18:29] Izu Mbaraonye: Oh, welcome back. So Miso, we try to focus mostly on the tech industry now. Can you tell us how, um, the tech industry has best used lobby? Like what are the classic cases of them using it in the more
[00:18:41] Mirzo Abdurakhmonov: beneficial way for themselves? It is interesting.
It is interesting. As we have alluded earlier in the conversation, it is difficult to quantify the benefits, uh, that arise from corporate politic activities or, uh, from, or even from lobbying because the findings of, uh, current research, both in political [00:19:00] science, in management literature, are in conclusive in terms of the direct benefits that firms, uh, can, again, from lobbying or from their corporate political.
However, there are some anecdotal, uh, evidence that, you know, these lobbying activities or corporate political activities, uh, would actually deliver some benefits to these firms. Uh, I think the, I think the latest anecdotal example I can, uh, think of is, uh, during Trump administration, you know, as the coronavirus started, uh, Trump administration enacted, uh, ban on issues of H one B Visa.
However, as we know in the US at least, tech firms have a huge demand for tech, uh, tech workers and, and that that they source either from India, China, or other, uh, foreign countries. And these firms, uh, Either using their direct links to, uh, the White House or, uh, using, uh, Business Round Table Trade Association or [00:20:00] Chamber of Commerce, uh, we're successful, uh, to persuade, uh, federal, the US federal government that this is actually will have a more immediate harm to these tech firms.
So as a result, they were able to gain, uh, get some exemptions. Uh, beyond that, obviously, uh, you all have heard probably the case of the battle between Amazon, Oracle and Microsoft for like 10 billion uh, dollar worth of, uh, federal government contract defense contract. In that specific case, uh, Amazon, uh, won the battle and Microsoft and Oracle were alleging that this, uh, contract would happen because of the revolvers that were working for Amazon at that point.
So literally showing that these lobbying, uh, and uh, revolving activity works.
[00:20:54] David Ornelas: Just to bring it down to my level of understanding, I came across, uh, term business knowledge [00:21:00] search. Can you explain what business knowledge search and why that knowledge search is
[00:21:03] Mirzo Abdurakhmonov: important? Business knowledge, uh, search, uh, in my view, at least on a, uh, ground level refers to activities of, uh, Firms to seek innovation.
And that, I think for research would say they could do this through exploration or exploitation. But in a nutshell, uh, to translate it to simple language, it's primarily whether a firm is investing in r and d, uh, research and development. So
[00:21:29] Izu Mbaraonye: I get different ways to, in this, I. Just from my understanding of knowledge search, like companies go different ways of doing it.
So like, can you try to tell us what kind of ways they go about doing
[00:21:40] Mirzo Abdurakhmonov: it? I think, uh, the literature would say they could engage in exploration, which is, uh, uh, getting, uh, involved with the long term activities, uh, in terms of coming up with a new products and new markets, uh, new ways, uh, uh, New ways, uh, of, uh, tackling [00:22:00] existing, uh, solution.
On the other hand, they could also, uh, focus on exploitation, meaning, uh, trying to ex, uh, ex, uh, improve their processes and procedures at the right moment. However, like if we are talking about like, uh, about the ultimate outcome of a business search, which is a achieving competitive advantage, you could argue they can, you know, engage in corporate political activity to get the same objectives.
[00:22:25] Izu Mbaraonye: So in a way you're saying that they can basically pay their core political activities
[00:22:28] Mirzo Abdurakhmonov: with their knowledge search? Yes. Yes. And there is a big debate in the literature, whether like, uh, knowledge search or saying invest investments in r and d research and development expenditures and, uh, cpa are they like, Corporate political activity there, compliments and or substitutes.
Some would argue like, uh, some scholars would argue that firms both try to, uh, invest in a r and d research and development, uh, and at the same time engage in corporate political activities. However, this. There is this [00:23:00] alternative view, uh, which I kind of mentioned that says that, uh, CPA would have some inertial outcomes.
And that in that case is that once a firm starts focusing on corporate political activities, uh, to achieve certain objectives, their business search could, uh, software overall. Uh, that's
[00:23:21] David Ornelas: actually a great segue into our next question. Um, Is there any specific strategies that stand out? Uh, when companies use, uh, their, uh, use their knowledge, search behavior to complement as politic corporate political
[00:23:37] Mirzo Abdurakhmonov: activities, so, Like there are several.
When we are broadly talking of corporate political activity, we are like talking of umbrella of tactics. Firms used to influence government, right? And under corporate political activity we have, uh, formal lobbying, which involves delivering information, right? Uh, beyond that, uh, they could [00:24:00] engage in, uh, campaign contribution, uh, up to certain limits.
We know that they're in the US context at least. Uh, there are limits to how much you can contribute to per, per candidate. And obviously, uh, these tech firms, uh, will have their own political action committees that will be funding, uh, candidates in. Uh, third way, uh, it could be like through engaging in, uh, corporate social activities because some researchers, scholars would argue that, uh, corporate CSR or firm, uh, corporate social responsibility activities is part of, uh, Uh, from corporate political activity.
Uh, other ways would be, uh, building constituency. Uh, so which involves like literally telling the employees of a firm, uh, go pressure your senator. Go pressure your congressman to help us in this way or in that way. So if they're seeking government contracts, subsidies, these are all like, uh, open.
Activities they could do, [00:25:00] they could do, Uh, alternatively, uh, interestingly, uh, as we are experiencing a lot of, um, uh, pushback from, uh, Congress and from, uh, overall federal government towards tech firms, uh, they are increasingly using ads, public ads in tv, in a cable tv, or in a internet to sway consumer saying that they are not that bad as a company.
Wow. Are these ads,
[00:25:28] David Ornelas: uh, Directed at, uh, politicians or is it more general sentiment?
[00:25:34] Mirzo Abdurakhmonov: Yeah, it's an interesting, uh, as I have said, constituency building is one of the ways that they, uh, the firms can influence government, right? Uh, these ads, in my view at least, and it's not valid. Uh, research winding is directed at the consumer, which would be constituency of these legisla.
So they wanna improve their image by these ads that they're running, uh, uh, on [00:26:00] tv. So, for example, don't get me wrong, I don't think there are, there is a direct, tangible, uh, benefit for Amazon or Facebook or Google from running these ads. They. They could be material directly to their financial bottom line, but more of a direct benefit is, uh, changing the perception of a constituency about these firms.
So saying these firms are not, you know, natural monopolies or like they're not taking advantage of a consumer data. Uh, so in other words, to avoid any negativity.
[00:26:34] Izu Mbaraonye: Yeah. Um, it's interesting that I bring up the ads strategy. So are there cases where companies run ads on behalf of the
[00:26:40] Mirzo Abdurakhmonov: politicians? I think you, you are talking about this super PAC phenomenon, I'm assuming, right?
I see. Uh, I think, uh, there is this delicate balance, and I have to be careful when I'm making this statement in a sense, uh, companies cannot directly engage on behalf of politicians, [00:27:00] right? Uh, but they can advocate for issues. Uh, so if you are running, uh, an ad on, on a certain issue, uh, , it cannot mention specific politician or specific, uh, legislator who's running for office.
Uh, it has to be, you know, advocating for some certain issue. And yes, there is always this delicate balance. So I would think, uh, firms would not get involved directly on behalf of certain politicians to legality issue. Yes, it is legality issue obvious. So,
[00:27:38] Izu Mbaraonye: um, this next question comes from me seeing an article about a comp, some companies that lobbying the fda and by them doing so, they're able to achieve, uh, faster patent reviews and also their patents are more likely to be approved.
And also brings me back to a case, I don't know if you're familiar with you, the vaping company, . So they lo the government quite a lot on the [00:28:00] Obama administration. And even though the FDA year wasn't okay with them releasing the, uh, vaping devices, they flavored vaping devices, they kind of well varied into realize it.
So there other cases where like explorative companies, like companies like Jews and, um, Medical companies make medical technology companies where they're making something very novel that they've been able to use lobby or CPA copy political activities to advance their products that fast or something that shouldn't have been
released
[00:28:26] Mirzo Abdurakhmonov: initially.
Uh, I think, uh, it's the issue of uh, whether there is a regulation in that specific landscape or not. So if you're coming up with a new product, uh, actually legislators or even uh, federal government agency officials will have no idea what type of product it is and what type of, uh, issues, uh, would arise as a result of approving it.
So in that particular case, uh, you would argue that if you can persuade politicians that you know this is a safe product, actually, uh, there are no, uh, [00:29:00] incremental, uh, harmful effects of that, uh, from that specific product, it would lead to a faster approval of permits, uh, faster approval of, uh, some specific.
Documents that's necessary to release product into the market. Uh, so here, like interestingly, think of lobbying as educating politicians, educating government because, uh, federal government agencies are limited in their time. They're limited in terms of resources, right? So if, you know, if you are persuading a government official, uh, with a new knowledge, Uh, obviously that is ac the knowledge that is accurate.
Yes. You could argue that in that case specifically, uh, these firms are accelerating, uh, the approval of their products, uh, given these activities. Uh,
[00:29:55] David Ornelas: sounds like there's a little bit of a kind of gray area with, uh, how that [00:30:00] is approached. Uh, can you. Talk a little bit about the
[00:30:04] Mirzo Abdurakhmonov: societal impact of lobbying.
Uh, yes. Uh, society wise, that I think two sides of the coin, right On one set. On, on one side you would say, uh, lobbying and corporate political, uh, activity is part of the game. and we are operating in a free market society, a free market economy. So in that sense, it's part of the game. So if I'm engaging in corporate political activities and lobbying, and if I'm winning, which, uh, that means it's good.
That will lead to the emergence of, uh, very big, large tech firms, uh, that can help a consumer. They can. Society that that can allow, uh, economies of scale. Economies of scope, which ultimately could translate into better products, better and cheaper products for end consumer. However, on the other hand, there is this alternative view of, uh, corporate political activity, which we briefly touched on earlier.[00:31:00]
Uh, in a sense you could argue that. By firms especially, uh, tech firms these days, by using corporate political activity, uh, they are establishing their dominance. So, you know, they are becoming so-called natural monopolies, uh, that, uh, in the long run could abuse their power. Think in terms of like how much data is being collected by these, uh, big tech forms.
Uh, they literally. Know that we are sitting here today because we have our phones. Uh, in that sense, like, uh, in the past, uh, a lot of, uh, at least. Individuals, we're not okay with government having so much information about you as an individual. But these days, uh, consumer is entrusting this information, uh, to a few firms.
So if a corporate political activity is leading to the emergence of the dominant nature of monopolies in tech [00:32:00] industry, uh, you could argue that there is this negative connotation. It will stiffen. Com future competition. It will, it may, uh, stiffen diversity in innovation and it may overall lead to higher prices rather than low prices that, you know, you would expect will happen because of economies of scale.
Economies of scope.
[00:32:20] Izu Mbaraonye: Yeah. So are there, and it seems like, um, There's a lot of negative perceptions of lobby, especially for those who are not directly experiencing it. So I guess that makes it important, I guess, for companies to find ways to manage those perceptions. Right. So are there things that companies do to manage the negative perceptions of them being engaged in lobbying?
[00:32:39] Mirzo Abdurakhmonov: Uh, interestingly, I would think they actually. Hide their lobbying activity because of this. A negative connotation, uh, in a sense, uh, because of this implicit bias in media towards corporate political activity, uh, a lot of companies, they don't wanna, uh, Actually disclose or be open [00:33:00] about, uh, whether they're, uh, uh, engaged in, uh, lobbying or corporate political activity.
I mean, we know this, uh, there is this, uh, congressional act from 1995, which, uh, requires that each company disclose the information and, uh, it's available, uh, in a public domain. So it's easy to find out whether, uh, public firms or any other firms are engaging, uh, in lobby. However, uh, in my view, uh, firms do not like that these activities, uh, you know, being reported in the media because of this negative connotation that is associated, uh, with, uh, lobbying or corporate political activity.
[00:33:44] David Ornelas: All right. Uh, and just round that out. I, I do have two questions for you. Uh, first question, uh, what should we be asking, asking yourself that, uh, someone like me wouldn't know to ask. What, Is there anything in particular that, [00:34:00] uh, is important that you think
[00:34:02] Mirzo Abdurakhmonov: we should know? So, if you're an outsider and you don't know that much about lobbying, uh, you could ask me saying, Hey, I'm a tech entrepreneur.
Should I engage in lobbying or should I hire a lobbyist? Uh, that would be good question to ask from the perspective of a tech entrepreneur, like a small tech firm that is just trying to find, uh, its footing. And my answer to that, uh, question, uh, would be, of course you should, because it's part of the game.
I mean, yes, there is this negative connotation associated with the corporate politic collectivities. , but, uh, you, we live in a free society, free economy that encourages, uh, each entity to legitimately, uh, make their, uh, voices hurt. And just go ahead and do it. All right. Uh,
[00:34:54] David Ornelas: and then, uh, final question here.
Uh, earlier this week, uh, as, as a person [00:35:00] involved with social media, we found out that, uh, Elon Musk of Tesla, it's bought out Twitter. Uh, do you expect to see an increase of lobbying either, uh, pro or against, uh,
[00:35:10] Mirzo Abdurakhmonov: that, uh, buyout? I think, uh, and it's a good question. It's interesting question a lot. From what I observe in social media, a lot of people are unhappy with that, uh, action.
Uh, because it shows that, I mean, and we know like how Twitter became, uh, important part of, uh, everyday life or a lot of Americans and even throughout the world in that sense, if one rich man can. Purchase a means of communication with the Walt for individuals. Uh, you could argue that's troubling. So in that sense, there would be people who are happy with that and there would be people who are not so happy because on one sense, like, uh, I think one of the first promises Ellen, Elon Mosque is making that he will open up [00:36:00] Twitter to.
A lot of people who were banned from Twitter earlier. Uh, and if you are support of free speech, you could be happy with that. You could argue, hey, that's fantastic because Twitter became, was becoming cen over time. But if you are worried that like, uh, key specifically Ella Mosque now would be filtering, uh, communication on Twitter based on his ideological, uh, or economic views, then that's also.
So I would say that would be both. That would be lobbying on both sides. But again, this is a free economy and free society. If one guy wants to purchase, uh, another enterprise and he or she has money, uh, I don't see any obstacle to it. Yeah,
[00:36:47] David Ornelas: I'm sure that next couple of years is how they play out are gonna be studied quite a lot.
[00:36:53] Mirzo Abdurakhmonov: Uh, and interestingly, you know, if you can afford to lose. Then just go for it. Like, because like, [00:37:00] uh, if I'm not mistaken, uh, he is paying a premium on, on the stocks. So, which means he's, uh, caring personal risk. And that's the beauty of about, uh, capitalism in a sense. If you can tolerate that risk, and if you're, you know, ready for it, just go for it.
[00:37:20] Izu Mbaraonye: Alright. Thank you, Mirzo.
[00:37:21] David Ornelas: Yeah, thank you Dr. Mirzo. I really appreciate your time here. Thank you.
[00:37:25] Elsbeth Magilton: Thank you for joining our student fellows on this episode of Tech Refactored. If you want to learn more about what we're doing here at NGTC or submit an idea for a future episode, you can go to our website at NGTC.unl.edu, or you can follow us on Twitter at UNL underscore ngtc.
If you enjoyed this show, don't forget to leave us a rating and review wherever you listen to podcasts. Our show was produced by myself, Elsbeth Magilton and Lysandra Marquez, and Colin McCarthy created and recorded our theme music. This podcast is part of the Menard Governance [00:38:00] and Technology Programming Series.
Until next time, hang in there and keep learning.[00:39:00]