Step 4. The two factory owners, however, find it very easy and profitable to coordinate their activities, so they

have a greater incentive to do so.

Special interests may develop a close relationship with one political party, so their ability to influence

legislation rises and falls as that party moves in or out of power. A special interest may even hurt a political

party if it appears to a number of voters that the relationship is too cozy. In a close election, a small group that

has been under-represented in the past may find that it can tip the election one way or another—so that group

will suddenly receive considerable attention. Democratic institutions produce an ebb and flow of political

parties and interests and thus offer both opportunities for special interests and ways of counterbalancing

those interests over time.

Identifiable Winners, Anonymous Losers

A number of economic policies produce gains whose beneficiaries are easily identifiable, but costs that are
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