Fueling Market Growth Through Collective Political Action: Shaping Favorable Public Policy in Regulated Markets

Although prior research has suggested that collective actors such as industry or trade associations play an important role in advocating for their members, few studies have examined how they facilitate new market formation and growth in regulated fields. Our study shows how collective actors may be instrumental in carving out specific, favorable policies from initially vague legislation, and that they do so by creating a univocal political messaging strategy to achieve support from regulators and legislators. Our empirical context is the biodiesel market in the United States, which depended on continuing federal obligated consumption mandates to survive. Our findings contribute to the literatures on collective political action and new market emergence by delineating the political influence process through which collective actors shape the trajectory of nascent markets.