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Advertising competition in presidential elections

Author

Listed:
  • Brett R. Gordon

    (Northwestern University)

  • Wesley R. Hartmann

    (Stanford University)

Abstract

Presidential candidates purchase advertising based on each state’s potential to tip the election. The structure of the Electoral College concentrates spending in battleground states, such that a majority of voters are ignored. We estimate an equilibrium model of multimarket advertising competition between candidates that allows for endogenously determined budgets. In a Direct Vote counterfactual, we find advertising would be spread more evenly across states, but total spending levels can either decrease or increase depending on the contestability of the popular vote. Spending would increase by 13 % in the extremely narrow 2000 election, but would decrease by 54 % in 2004. These results suggest that the Electoral College greatly increases advertising spending in typical elections.

Suggested Citation

  • Brett R. Gordon & Wesley R. Hartmann, 2016. "Advertising competition in presidential elections," Quantitative Marketing and Economics (QME), Springer, vol. 14(1), pages 1-40, March.
    • Handle: RePEc:kap:qmktec:v:14:y:2016:i:1:d:10.1007_s11129-016-9165-6
    DOI: 10.1007/s11129-016-9165-6
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    3. Liberini, Federica & Redoano, Michela & Russo, Antonio & Cuevas, Angel & Cuevas, Ruben, 2018. "Politics in the Facebook Era Evidence from the 2016 US Presidential Elections," CAGE Online Working Paper Series 389, Competitive Advantage in the Global Economy (CAGE).
    4. Mitchell J. Lovett, 2019. "Empirical Research on Political Marketing: a Selected Review," Customer Needs and Solutions, Springer;Institute for Sustainable Innovation and Growth (iSIG), vol. 6(3), pages 49-56, December.
    5. Yanwen Wang & Michael Lewis & David A. Schweidel, 2018. "A Border Strategy Analysis of Ad Source and Message Tone in Senatorial Campaigns," Marketing Science, INFORMS, vol. 37(3), pages 333-355, May.
    6. Naoki Aizawa & You Suk Kim, 2020. "Public and Private Provision of Information in Market-Based Public Programs: Evidence from Advertising in Health Insurance Marketplaces," NBER Working Papers 27695, National Bureau of Economic Research, Inc.
    7. Brett R. Gordon & Mitchell J. Lovett & Bowen Luo & James C. Reeder, 2023. "Disentangling the Effects of Ad Tone on Voter Turnout and Candidate Choice in Presidential Elections," Management Science, INFORMS, vol. 69(1), pages 220-243, January.
    8. Maria Petrova & Ananya Sen & Pinar Yildirim, 2021. "Social Media and Political Contributions: The Impact of New Technology on Political Competition," Management Science, INFORMS, vol. 67(5), pages 2997-3021, May.
    9. Qiang Fu & Ganesh Iyer, 2019. "Multimarket Value Creation and Competition," Marketing Science, INFORMS, vol. 38(1), pages 129-149, January.
    10. Michael Sinkinson & Amanda Starc, 2015. "Ask Your Doctor? Direct-to-Consumer Advertising of Pharmaceuticals," NBER Working Papers 21045, National Bureau of Economic Research, Inc.
    11. Lingling Zhang & Doug J. Chung, 2020. "The Air War vs. the Ground Game: An Analysis of Multichannel Marketing in U.S. Presidential Elections," Marketing Science, INFORMS, vol. 39(5), pages 872-892, September.
    12. Maria Petrova & Ananya Sen & Pinar Yildirim, 2020. "Social Media and Political Contributions: The Impact of New Technology on Political Competition," Papers 2011.02924, arXiv.org.
    13. Andrey Simonov & Szymon Sacher & Jean-Pierre Dubé & Shirsho Biswas, 2022. "Frontiers: The Persuasive Effect of Fox News: Noncompliance with Social Distancing During the COVID-19 Pandemic," Marketing Science, INFORMS, vol. 41(2), pages 230-242, March.

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    More about this item

    Keywords

    Advertising; Politics; Empirical game; Presidential election; Electoral college; Direct vote; Resource allocation; Contest;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • M37 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Advertising

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