Advertising Competition in Presidential Elections∗

Presidential candidates choose advertising strategically across markets based on each state’s potential to tip the election. The winner-take-all rules in the Electoral College concentrate advertising in battleground states, ignoring the majority of voters. We develop an empirical games approach to estimate an equilibrium model of competition between candidates and to compare outcomes under the Electoral College and a Direct Vote. A direct vote counterfactual reveals positive advertising levels in all states. However, the geographic distribution of advertising shifts from a roughly symmetric distribution centered in battleground states to a right-skewed distribution reflecting significantly higher costs of reaching voters in left-leaning markets. Additional counterfactuals reveal that the increased emphasis on ad prices arises because political preferences exhibit a minimal effect on candidates strategies. This suggests that candidates’ policy preferences and other forms of attention would be more uniform in a Direct Vote.