In an electoral race, interest groups will be willing to finance political candidates’ campaigns in return for favors that are costly to voters. Starting from the empirical observation of split contributions, we develop a theoretical model of directly informative campaign advertising with rational voters. In this setting, interest groups that demand more favors are less likely to finance candidates to enhance their electoral prospects. We find that the only feasible Pareto improving policy involves providing specific limits and subsidies to each candidate. Unfortunately, this policy is very demanding in terms of information for the policy maker and always involves candidates providing favors to interest groups. We argue that bans on contributions without public subsidies may not be welfare improving, since they negatively affect the informational value of advertisements

Gregorini, F., Pavesi, F. (2011). Do Campaign Finance Policies Really Improve Voters' Welfare? [Working paper del dipartimento].

Do Campaign Finance Policies Really Improve Voters' Welfare?

GREGORINI, FILIPPO;PAVESI, FILIPPO
2011-04

Abstract

In an electoral race, interest groups will be willing to finance political candidates’ campaigns in return for favors that are costly to voters. Starting from the empirical observation of split contributions, we develop a theoretical model of directly informative campaign advertising with rational voters. In this setting, interest groups that demand more favors are less likely to finance candidates to enhance their electoral prospects. We find that the only feasible Pareto improving policy involves providing specific limits and subsidies to each candidate. Unfortunately, this policy is very demanding in terms of information for the policy maker and always involves candidates providing favors to interest groups. We argue that bans on contributions without public subsidies may not be welfare improving, since they negatively affect the informational value of advertisements
Working paper del dipartimento
Campaign Finance; Interest Groups; Elections; Welfare;
English
Gregorini, F., Pavesi, F. (2011). Do Campaign Finance Policies Really Improve Voters' Welfare? [Working paper del dipartimento].
Gregorini, F; Pavesi, F
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/10281/22952
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