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Money Talks: The Impact of Citizens United on State Elections

Author

Listed:
  • Tilman Klumpp

    (University of Alberta, Department of Economics)

  • Hugo Mialon

    (Emory University)

  • Michael Williams

    (Competition Economics)

Abstract

The U.S. Supreme Court has ruled that restrictions on independent political expenditures by corporations and labor unions are unconstitutional on First Amendment grounds (Citizens United v. FEC, 2010). In this paper, we test the hypothesis that the decision gave an electoral boost to Republicans, at the expense of Democrats. The 50 states provide an ideal testing ground for this hypothesis. The ruling only affected a subset of states since the majority of states already had no restrictions on independent expenditures, allowing us to obtain difference-in-differences estimates of the short term effects of the ruling on electoral advantage. We find that Citizens United had a positive and statistically significant effect of approximately seven percentage points on the probability of Republicans winning in state congressional elections.

Suggested Citation

  • Tilman Klumpp & Hugo Mialon & Michael Williams, 2012. "Money Talks: The Impact of Citizens United on State Elections," Working Papers 2012-18, University of Alberta, Department of Economics.
    • Handle: RePEc:ris:albaec:2012_018
    as

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    File URL: https://sites.ualberta.ca/~econwps/2012/wp2012-18.pdf
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    References listed on IDEAS

    as
    1. Thomas Stratmann & Francisco Aparicio-Castillo, 2007. "Campaign finance reform and electoral competition: Comment," Public Choice, Springer, vol. 133(1), pages 107-110, October.
    2. Puhani, Patrick A., 2012. "The treatment effect, the cross difference, and the interaction term in nonlinear “difference-in-differences” models," Economics Letters, Elsevier, vol. 115(1), pages 85-87.
    3. Ai, Chunrong & Norton, Edward C., 2003. "Interaction terms in logit and probit models," Economics Letters, Elsevier, vol. 80(1), pages 123-129, July.
    4. Thomas Stratmann & Francisco J. & Aparicio-Castillo, 2006. "Competition policy for elections: Do campaign contribution limits matter?," Public Choice, Springer, vol. 127(1), pages 177-206, April.
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    Keywords

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    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • K19 - Law and Economics - - Basic Areas of Law - - - Other

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