Nature or Nurture? Sources of Firm Preference for National Health Reform

Abstract

I shall explore the process by which firms develop their political preferences, using the case of national health reform. Although rising health costs have heavily burdened many companies, I argue that economic interests alone are unable to account for the variation in firm response to the national reform effort. Rather, institutional factors, shown elsewhere to shape government decision making, also influence corporate preferences. These are (1) the institutionalization of private policy expertise within the firm, (2) firm participation in policy groups, and (3) policy legacies. These findings challenge conventional views of business political mobilization that suggest largely autonomous agents acting on the basis of easily recognized self-interests. Preference formation and corporate mobilization transpire in collective settings as a new stratum of corporate policy managers search for solutions to social problems. The primacy of economic concerns is very real. But institutional analysis explains how these economic concerns are interpreted and acted upon.