It looks like Wal Mart will be able to enter the DC retail market. That's good news for DC area consumers as the market for retail goods becomes that much more competitive. But Craig Newmark remarks:
It's nice that Wal-Mart will soon be opening stores in D.C. But reading this, I thought: how much could they have lowered their prices or raised their employees' pay with all the money they had to spend lobbying?
The price level at the DC Wal Marts should be higher as Wal Mart seeks a return on their lobbying investment. But if the MRP theory of employee compensation holds, then as long as the lobbying has no effect on either MR or MP, then the expenditure on lobbying will have no effect on employee compensation. This is, of course, an empirically testable hypothesis given the right data.