Money and Politics: The Effects of Campaign Spending Limits on Political Entry and Competition
- (pp. 167-99)
Abstract
This paper studies the effects of campaign spending limits on the political entry, selection, and behavior of local politicians in Brazil. We analyze a reform that limits campaign spending for mayoral elections. The limits were implemented with a discontinuity that we exploit for causal identification. We find that stricter limits reduce reelection rates and increase political competition by attracting more candidates who are also less wealthy and rely less on self-financing. Despite their effects on electoral outcomes, stricter limits did not lead to significant short-run improvements in policy outcomes, such as in education and health.Citation
Avis, Eric, Claudio Ferraz, Frederico Finan, and Carlos Varjão. 2022. "Money and Politics: The Effects of Campaign Spending Limits on Political Entry and Competition." American Economic Journal: Applied Economics, 14 (4): 167-99. DOI: 10.1257/app.20200296Additional Materials
JEL Classification
- D72 Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- O17 Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
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