The petit effect of campaign spending on votes: using political financing reforms to measure spending impacts in multiparty elections

This paper explores the relation between campaign spending and votes, in France, relying on political financing reforms as a quasi-natural experiment to assess if how affects for both incumbent challenger candidates multiparty legislative elections. The French were adopted mid-1990s, modifying fundraising rules three important ways: (1) limits reduced, (2) legal entities no longer allowed fund candidates, (3) maximal amount of candidates’ personal reimbursed by State was raised. We study observations two consecutive elections, one before after reforms. difference expenses across elections turns out be strongly affected reforms: from extreme parties (far left far right) increased their expenditures substantially, while fielded moderate reduced them considerably. Focusing politicians running we estimate impact using first-difference panel data methods TSLS. Our instrumental variables are constructed regulatory find that incumbents did not have statistically significant effects vote shares. Spending challengers is but nevertheless economically small.