An interest group is an organization of people who share a common interest and work together to protect and promote that interest by influencing the government. Interest groups vary greatly in size, aims, and tactics. Political scientists generally divide interest groups into two categories: economic and noneconomic.
Economic groups, which seek some sort of economic advantage for their members, are the most common type of interest group. Money has significant influence in capitalist societies, so economic interest groups are numerous and powerful. These groups are usually well funded because members willingly contribute money in the hopes of reaping greater political influence and profit.
Economic groups work to win private goods, which are benefits that only the members of the group will enjoy. When a labor union agrees to a contract, for example, its members benefit from the contract, whereas nonunion members do not. If there is no private good incentive, people might choose not to join (especially if there is a membership fee or dues). There are four main types of economic groups: business groups, labor groups, agricultural groups, and professional associations.
Business groups are the most common type of interest group; more than half of all registered lobbyists work for business organizations. Some business lobbyists work for a single corporation, lobbying solely for that company. Businesses also form associations with companies from the same industry to promote all of their interests. For example, the American Petroleum Institute works on behalf of oil companies. Some groups act on behalf of business in general. The U.S. Chamber of Commerce, for example, seeks pro-business policies in general, not just policies that help one part of the economy.
Because they are usually well funded, business groups tend to be very influential. They work to promote the interests of private companies and corporations by seeking tax cuts, regulatory changes, and other pro-business benefits. Business groups do not always agree with one another, however. What benefits one industry may harm another, so advocates for those industries quite often work against one another.
Labor groups represent unions, which work to increase wages and improve working conditions for both skilled and unskilled workers. Individual workers have very little power, but banded together, they can wield significant influence. Labor unions have been a significant part of American economic and political life since the late nineteenth century. At the peak of the unions’ influence, roughly one-third of American workers belonged to labor unions.