Side Effects of Campaign Finance Reform

Matthias Dahm and Nicolás Porteiro

No 1408, Discussion Papers from Northwestern University, Center for Mathematical Studies in Economics and Management Science

Abstract: Since campaign finance reform is usually motivated by the concern that existing legislation can not effectively prevent campaign contributions to ‘buy favors’, this paper assumes that contributions influence political decisions. But, given that it is also widely recognized that interest groups achieve influence by providing political decision makers with policy relevant information, we also assume that lobbies engage in non-negligible informational lobbying. We focus on a single political decision to be taken and offer a simple model in which the optimal influence strategy is a mixture of both lobbying instruments. Our main result is to show that campaign finance reform may have important side effects: It may deter informational lobbying so that less policy relevant information is available and as a result political decisions become less efficient.

Keywords: party and candidate financing; lobbying; interest groups; experts; information transmission; contributions; influence; political decision making process. (search for similar items in EconPapers)
JEL-codes: C72 D72 (search for similar items in EconPapers)
Date: 2005-07
New Economics Papers: this item is included in nep-cdm and nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Related works:
Journal Article: Side Effects of Campaign Finance Reform (2008)
Working Paper: Side Effects of Campaign Finance Reform (2006)
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