(When) are lobbying expenditures a good proxy for lobbying activity?

Overview & Synopsis

Lobbying expenditures are widely used as a proxy variable for measuring lobbying activity. However, the validity of this approach has rarely been examined and existing justifications do not account for heterogeneity in expenditure formats across types of lobbyists. I address the question using unique lobbying disclosure data from Wisconsin, where lobbying organizations report both expenditures on lobbying-related activities and lobbyists’ hours worked. Strong overall correlations between changes in expenditures and hours worked within organization–lobbyist dyads indicate that lobbying expenditures can serve as a reasonable proxy. However, caution is warranted due to substantial heterogeneity, with contract lobbyist relationships exhibiting weaker correlations than in-house relationships. I conclude by providing suggestions to improve empirical analyses that rely on lobbying expenditures.