Advertising Effects in Presidential Elections
Brett R. Gordon
Northwestern University - Kellogg School of Management
Wesley R. Hartmann
Stanford University - Graduate School of Business
August 21, 2012
Stanford Graduate School of Business Research Paper No. 2080
Columbia Business School Research Paper No. 12/33
Presidential elections provide both an important context in which to study advertising and a setting that mitigates the challenges of dynamics and endogeneity. We use the 2000 and 2004 general elections to analyze the effect of market-level advertising on county-level vote shares. The results indicate significant positive effects of advertising exposures. Both instrumental variables and fixed effects alter the ad coefficient. Advertising elasticities are smaller than are typical for branded goods, yet significant enough to shift election outcomes. For example, if advertising were set to zero and all other factors held constant, three states' electoral votes would have changed parties in 2000. Given the narrow margin of victory in 2000, this shift would have resulted in a different president.
Number of Pages in PDF File: 41
Keywords: advertising, politics, instrumental variables, presidential elections
Date posted: July 9, 2011 ; Last revised: August 25, 2012
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