Deck 7: Nonmarket Strategies for Government Arenas

Question 1

When there is competition among interests, as in the case of interest group politics, the effectiveness of a strategy is independent of the strategies that others are pursuing on the issue.

Answer 1

False

Question 2

Strategy formulation in the nonmarket environment is similar to its counterpart in the market environment.

Answer 2

False

Question 3

Although nonmarket strategies focus on the initial institutional arena, the subsequent delegation to administrative or regulatory agencies is a public process.

Answer 3

False

Question 4

A waste disposal company misrepresents information on ground water toxicity level to the residents near its plant. This is a form of manipulation in business nonmarket activity.

Question 5

Rent chain can be mobilized only on issues inside governmental institutions.

Question 6

The nonmarket power of business is controlled because it is naturally divided.

Question 7

The reputation of a firm and its top management is an important nonmarket asset.

Question 8

Cost pressure and information demand are primary nonmarket assets for firms and interest groups for strategy formulation.

Question 9

Firms have the right to form and participate in coalitions and associations to conduct nonmarket activity.

Question 10

The nonmarket strategies available to firms are the same as those available to other interest groups but its appropriateness and effectiveness can differ.

Question 11

In nonmarket competition, society can neither control the nonmarket power exercised by firms nor require the disclosure of nonmarket actions.

Question 12

The formulation of nonmarket strategies is the responsibility of the society intervening in such issues.

Question 13

A firm injured by unfair foreign competition can file a petition for relief under the U.S. trade law.

Question 14

Constituency connection, campaign contributions, or a reputation for providing reliable information are nonmarket assets.

Question 15

The nonmarket activities of business and other interest groups are not monitored.

Question 16

Firms do not have the right to participate in political processes because of the particular interests they represent.

Question 17

Nonmarket issues attract a fewer set of participants than those involved in markets.

Question 18

When an industry seeks to defeat legislation, a unified position is most effective.

Question 19

From a pluralist perspective, public interest is identified by the interests of individuals and groups in the context of political institutions.

Question 20

In a nonmarket analysis, motivation and the nature of the politics are important factors to the development of effective strategies.

Question 21

The responsibility for formulating nonmarket strategies ultimately rests with ________.

A) taxpayers
B) management
C) public institutions
D) interest groups

Question 22

Which of the following reflects a firm's nonmarket assets?

A) switching costs
B) customer loyalty
C) reputation of the top management
D) investment in mutual funds

Question 23

________ keep a check on business nonmarket power.

A) Activist groups
B) Management of firms
C) Human resource departments
D) Employees

Question 24

Collective nonmarket action, such as joint lobbying to influence government ________.

A) violates antitrust laws
B) is considered as manipulation
C) cannot be associated with corporations
D) does not violate antitrust laws

Question 25

Implementation of nonmarket strategies pertains to the selection of specific actions and the assignment of tasks to organizational units and individual managers.

Question 26

In terms of business nonmarket action, ________ can take two basic forms: one involves misrepresentation and the other involves exploiting institutional features.

A) nonmarket analysis
B) lobbying
C) manipulation
D) strategy formulation

Question 27

Nonmarket strategies are the link between ________.

A) institutions and institutional officeholders
B) objectives and the specific actions taken to achieve them
C) motivations and incentives of an issue
D) the demand for and supply of nonmarket action

Question 28

Strategy formulation in the nonmarket environment ________.

A) does not require collective action
B) attracts a broader set of participants than those involved in markets
C) implements important components in private
D) resolves issues through voluntary agreements

Question 29

In politically responsive institutions success depends more on the provision of technical information.

Question 30

A car manufacturing firm is deliberately neglecting state environmental laws. Which of the following responses from the society is applicable here?

A) society may control the exercise of market power through regulation
B) society may rely on market forces to develop substitute products
C) society cannot require disclosure of nonmarket actions
D) society can rely on countervailing influences from opposing interests to mitigate business nonmarket power

Question 31

________ Amendment protects the right of corporations to make expenditures and participate in political competitions on a state ballot proposition.

A) First
B) Second
C) Tenth
D) Sixteenth

Question 32

Firms need to develop contingent strategies as nonmarket competition on an issue is limited to a single institutional arena.

Question 33

Which of the following statements is true of nonmarket activities of businesses from the perspective of the public?

A) Businesses misrepresent information that play on ignorance and biases.
B) Businesses do not have too much power to make a change in the society.
C) Businesses do not exploit institutional features.
D) Business goals are always congruent with public interests.

Question 34

Nonmarket analysis involves ________.

A) assessing the industry cost structure
B) analyzing the financial statements of the firm
C) identifying distribution channels
D) assessing institutional characteristics

Question 35

The approach to nonmarket strategy formulation ________.

A) requires the delegation of administrative responsibility to an agency or a regulatory commission
B) addresses nonmarket issues of a firm directly in public institutions
C) does not require nonmarket strategies to focus on initial institutional arena as there is no competition between different interests of a firm
D) resolves nonmarket issues by voluntary agreements and thus, does not need strategy formulation

Question 36

The underlying principle of the rent chain is that ________.

A) the greater the rents affected by a nonmarket issue, the lower are the incentives to take nonmarket action to obtain or protect those rents
B) the lower the rents affected by a nonmarket issue, the greater are the incentives to take nonmarket action to obtain or protect those rents
C) the rents affected by a nonmarket issue are independent of the incentives to take nonmarket action to obtain those rents
D) the greater the rents affected by a nonmarket issue, the greater are the incentives to take nonmarket action to obtain or protect those rents

Question 37

Corporate participation in political activities ________.

A) can give voice to people whose interests might otherwise be unrepresented
B) always leads to over-representation of interests
C) does not advance public interest
D) cannot be aligned with the interests of activist groups

Question 38

Which of the following statements is applicable to the approach to nonmarket strategy formulation in interest group politics?

A) Strategies should increase the benefits to those with aligned interests and reduce their costs of taking nonmarket action.
B) Strategies should increase the opposing side's incentives to take nonmarket action.
C) It is a linear process and does not involve taking into account other interests.
D) Nonmarket strategies for firms are often more wider than the set of strategies used by other interests.

Question 39

In client politics, firms prefer to adopt a high-profile strategy that includes public advocacy to counter the opposition.

Question 40

Vote recruiting is a majority-building strategy.

Question 41

Nonmarket activities of business support political alternatives that may be contrary to public interest. Discuss.

Question 42

What are the components of nonmarket analysis?

Question 43

Informational strategy is a key component of lobbying. Discuss.

Question 44

Which of the following is a necessary condition for an informational strategy to be effective?

A) favorable information must be provided to the legislator
B) government officeholders are more informed than the interest group
C) interest group is more informed about the issue than are the government officeholders
D) the public holds superior information about an issue than the interest group.

Question 45

Low-profile nonmarket strategies are most suitable for ________.

A) interest group
B) majoritarian politics
C) client politics
D) entrepreneurial politics

Question 46

Highlight the differences between strategy formulation in the nonmarket environment and in the market environment.

Question 47

Which of the following represents strategy implementation in a nonmarket issue for a tire manufacturer?

A) It hires a law firm to provide advice on emission taxes and subsidies on industrial waste disposal.
B) It analyzes and concludes that other manufacturing companies have similar interests.
C) It decides to obtain access to members of the Congress by hiring former government officials for lobbying.
D) It identifies that petitions can be filed under the sections of U.S. manufacturing laws.

Question 48

In public politics, nonmarket strategies are ultimately directed at ________.

A) government officeholders
B) customers
C) stakeholders
D) interest groups

Question 49

Which of the following is applicable to agenda-setting in nonmarket strategies?

A) It focuses first on recruiting the agenda setter and then on building support for the alternative on the agenda.
B) It is suitable for a relatively open legislative process that does not require vote recruiting.
C) It focuses first on building support for the alternative on the agenda and then on recruiting an agenda setter.
D) It is most effective in interest group politics.

Question 50

A rent chain ________.

A) does not help generate nonmarket action through constituency connection.
B) gives a firm the right or the opportunity to participate in public processes.
C) can be mobilized only on issues in the government institutions.
D) does not include stakeholders irrespective of whether they benefit from their interactions with the firm.

Question 51

Which of the following is applicable to the implementation of nonmarket strategies?

A) hiring a firm to assess industry cost structure
B) assigning employees to analyze the financial statements of the firm
C) hiring candidates to handle a new project
D) designating a manager to engage in lobbying

Question 52

Strategies involving the provision of political information are ________.

A) not used for regulatory and administrative agencies
B) independent of the political responsiveness of institutions
C) are associated with less politically responsive institutions
D) often used in conjunction with representation strategies

Question 53

Generic nonmarket representation strategies are based on ________.

A) developing the needed votes in a legislature to enact or defeat a bill
B) the consequences of alternatives for constituents of government officeholders
C) providing information to government officeholders
D) analyzing industrial costs structures

Question 54

What are the two basic forms of manipulation in business nonmarket activity?

Question 55

Which of the following represents strategy formulation in a nonmarket issue?

A) A firm hires a law firm to provide advice on energy subsidies and emission taxes.
B) A firm designates a manager to engage in lobbying for energy subsidies in Washington.
C) A firm identifies that the energy subsidy and emission tax issue will be pursued with the state government and then at the national level.
D) A firm forms an ad hoc coalition with U.S. companies that require energy subsidies.