This paper uses panel data for the US states to investigate state-based free market (SBFM) think tanks’ effect on eight key economic policy objectives. We find that SBFM think tanks have had a "pro-market" effect on several of the policies they aim to influence. Also, there is a positive relationship between SBFM think tanks and citizens’ attitudes toward markets vs. government. These results point to "ideas" as an important channel through which think tanks influence policy. However, we also find that SBFM think tanks’ effect on policy is dwarfed by political lobby groups’ effect. Taken together our results suggest that ideas matter. But money matters more.
Read the paper at Science Direct.