A Model of Interest Group Influence and Campaign Advertising

We analyze a citizen–candidate model of elections between an incumbent and challenger to investigate the logic of interest group influence on election outcomes through campaign advertising. Whereas the incumbent's position is known to voters, the challenger is relatively unknown, and groups may allocate spending (either directly through independent expenditures or indirectly through campaign donations) to advertise the challenger's position. We prove that equilibria can feature either positive or negative advertising, but not both at the same time: ex ante evaluations of the challenger by the median voter determine which kind of advertising will arise. In a positive advertising equilibrium, only challengers located in a centrally located spending interval are advertised and win, while in a negative advertising equilibrium, challengers who are too extreme are targeted and lose. The analysis sheds light on the determinants of political advertising and voter beliefs, and it emphasizes their endogeneity with respect to the parameters of the model, e.g., the incumbent's location, prior beliefs of voters about the challenger's location, and the effectiveness of advertising technology. Moreover, it illuminates the preconditions for positive and negative advertising, and indicates circumstances in which one tactic is more likely to be employed than the other.