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Political Campaign Spending Limits


  • Ivan Pastine

    () (University College Dublin)

  • Tuvana Pastine

    () (Economics,Finance and Accounting National University of Ireland,)


Political campaign spending ceilings are purported to limit the incumbent’s ability to exploit his fundraising advantage. If the challenger does not have superior campaign effectiveness, in contrast to conventional wisdom, we show that the incumbent always benefits from a limit as long as he has an initial voter disposition advantage, however small and regardless of the candidates’ relative fundraising ability. If the challenger has higher campaign spending effectiveness, the effect of limits may be non-monotonic. If the incumbent enjoys a mild initial voter disposition advantage, a moderate limit benefits the challenger. Further restricting the limit favours the incumbent. Stricter limits may lead to the unintended consequence of increased expected spending.

Suggested Citation

  • Ivan Pastine & Tuvana Pastine, 2010. "Political Campaign Spending Limits," Economics, Finance and Accounting Department Working Paper Series n213-10.pdf, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
  • Handle: RePEc:may:mayecw:n213-10.pdf

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    References listed on IDEAS

    1. Ivan Pastine & Tuvana Pastine, 2010. "Politician preferences, law-abiding lobbyists and caps on political contributions," Public Choice, Springer, vol. 145(1), pages 81-101, October.
    2. Nicolas Sahuguet & Nicola Persico, 2006. "Campaign spending regulation in a model of redistributive politics," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 28(1), pages 95-124, May.
    3. Che, Yeon-Koo & Gale, Ian L, 1998. "Caps on Political Lobbying," American Economic Review, American Economic Association, vol. 88(3), pages 643-651, June.
    4. Prat, Andrea, 2002. "Campaign Spending with Office-Seeking Politicians, Rational Voters, and Multiple Lobbies," Journal of Economic Theory, Elsevier, vol. 103(1), pages 162-189, March.
    5. Ivan Pastine & Tuvana Pastine, 2008. "Politician Preferences,Law-Abiding Lobbyists and Caps on Political Lobbying," Economics, Finance and Accounting Department Working Paper Series n1991208.pdf, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
    6. Palda, Filip, 1992. "The Determinants of Campaign Spending: The Role of the Government Jackpot," Economic Inquiry, Western Economic Association International, vol. 30(4), pages 627-638, October.
    7. Kevin Milligan & Marie Rekkas, 2008. "Campaign spending limits, incumbent spending, and election outcomes," Canadian Journal of Economics, Canadian Economics Association, vol. 41(4), pages 1351-1374, November.
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    Cited by:

    1. Martin Grossmann & Helmut Dietl, 2012. "Asymmetric contests with liquidity constraints," Public Choice, Springer, vol. 150(3), pages 691-713, March.
    2. HHironori Otsubo, 2012. "Contests with Incumbency Advantages: An Experiment Investigation of the Effect of Limits on Spending Behavior and Outcome," Jena Economic Research Papers 2012-020, Friedrich-Schiller-University Jena.


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