Why Is There So Little Money in Politics?

Stephen Ansolabehere, John M. de Figueiredo, James M. Snyder

NBER Working Paper No. 9409
Issued in January 2003
NBER Program(s):Law and Economics, Public Economics

In this paper, we argue that campaign contributions are not a form of policy-buying, but are rather a form of political participation and consumption. We summarize the data on campaign spending, and show through our descriptive statistics and our econometric analysis that individuals, not special interests, are the main source of campaign contributions. Moreover, we demonstrate that campaign giving is a normal good, dependent upon income, and campaign contributions as a percent of GDP have not risen appreciably in over 100 years: if anything, they have probably fallen. We then show that only one in four studies from the previous literature support the popular notion that contributions buy legislators' votes. Finally, we illustrate that when one controls for unobserved constituent and legislator effects, there is little relationship between money and legislator votes. Thus, the question is not why there is so little money politics, but rather why organized interests give at all. We conclude by offering potential answers to this question.

download in pdf format
   (328 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w9409

Published: Ansolabehere, Stephen, John de Figueiredo, and James M. Snyder. "Why Is There So Little Money in U.S. Politics?" Journal of Economic Perspectives 17, 1 (Winter 2003): 105-130.

Users who downloaded this paper also downloaded* these:
de Figueiredo and Silverman w9064 Academic Earmarks and the Returns to Lobbying
Grimm and Hirsch The Impact of the 1976 NIPA Benchmark Revision on the Structure and Predictive Accuracy of the BEA Quarterly Econometric Model
Levitt and Snyder, Jr. w5002 The Impact of Federal Spending on House Election Outcomes
Grossman and Helpman w4149 Protection For Sale
Jones, Reedy, and Weinberg w19866 Age and Scientific Genius
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us