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Campaign contributions and policy convergence: asymmetric agents and donations constraints

Author

Listed:
  • Eric Dunaway

    (Wabash College)

  • Felix Munoz-Garcia

    (Washington State University)

Abstract

We extend previous work on the role of politically motivated donors who contribute to candidates in an election with single dimension policy preferences. In a two-stage game wherein donors observe candidate policy positions and then allocate funding accordingly, we find that reducing the cost of donations incentivizes candidates to position closer to one another, reducing policy divergence. Furthermore, we find that as donations become more effective at influencing voter decisions, candidates respond less to voter preferences and more to those of donors. In addition, we analyze the presence of asymmetries in the model using numerical analysis techniques. We also extend our model by allowing for public funding from governments. By implementing stringent campaign contribution limits, candidate positions align with voter preferences at the cost of wider policy divergence. In contrast, unlimited campaign contributions lead to candidate positions moving away from voters to donors’ preferences, but increase policy convergence.

Suggested Citation

  • Eric Dunaway & Felix Munoz-Garcia, 2020. "Campaign contributions and policy convergence: asymmetric agents and donations constraints," Public Choice, Springer, vol. 184(3), pages 429-461, September.
    • Handle: RePEc:kap:pubcho:v:184:y:2020:i:3:d:10.1007_s11127-019-00732-1
    DOI: 10.1007/s11127-019-00732-1
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    More about this item

    Keywords

    Asymmetries; Policy preferences; Policy divergence; Donors; Political contributions; Campaign limits;
    All these keywords.

    JEL classification:

    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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