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Do campaign spending limits diminish competition? An experiment

Author

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  • Hironori Otsubo

    (Soka University)

Abstract

This paper experimentally investigates the effect of limits on campaign expenditure and outcome in an electoral contest where two candidates, an incumbent and a challenger, compete for office in terms of the amount of campaign expenditure. The candidates are asymmetric only in that the incumbent wins the contest in case of a tie. Theory predicts that in the presence of such asymmetry spending limits put the challenger at a disadvantage and tightening the limits leads to further entrenchment of the incumbent. The experimental results confirmed the theoretical predictions.

Suggested Citation

  • Hironori Otsubo, 2013. "Do campaign spending limits diminish competition? An experiment," Economics Bulletin, AccessEcon, vol. 33(3), pages 2223-2234.
    • Handle: RePEc:ebl:ecbull:eb-13-00500
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    References listed on IDEAS

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    Cited by:

    1. Llorente-Saguer, Aniol & Sheremeta, Roman M. & Szech, Nora, 2023. "Designing contests between heterogeneous contestants: An experimental study of tie-breaks and bid-caps in all-pay auctions," European Economic Review, Elsevier, vol. 154(C).
    2. Gelder, Alan & Kovenock, Dan & Sheremeta, Roman, 2015. "Behavior in All-Pay Auctions with Ties," MPRA Paper 67517, University Library of Munich, Germany.
    3. Llorente-Saguer, Aniol & Sheremeta, Roman & Szech, Nora, 2016. "Designing Contests Between Heterogeneous Contestants: An Experimental Study of Tie-Breaks and Bid-Caps in All-Pay Auctions," MPRA Paper 71202, University Library of Munich, Germany.
    4. Hironori Otsubo, 2015. "Nash Equilibria in a Two-Person Discrete All-Pay Auction with Unfair Tie-Break and Complete Information," Economics Bulletin, AccessEcon, vol. 35(4), pages 245-245.

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    More about this item

    Keywords

    Electoral contest; Spending limit; Incumbency advantage; Experiment;
    All these keywords.

    JEL classification:

    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory

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