Financing Direct Democracy: Revisiting the Research on Campaign Spending and Citizen Initiatives

46 Pages Posted: 6 Sep 2010

See all articles by John M. de Figueiredo

John M. de Figueiredo

Duke University School of Law; Duke University - Fuqua School of Business; National Bureau of Economic Research (NBER); Duke Innovation & Entrepreneurship Initiative

Chang Ho Ji

La Sierra University

Thad Kousser

University of California, San Diego (UCSD) - Department of Political Science

Multiple version iconThere are 2 versions of this paper

Date Written: September 5, 2010

Abstract

The conventional view in the direct democracy literature is that spending against a measure is more effective than spending in favor of a measure, but the empirical results underlying this conclusion have been questioned by recent research. We argue that the conventional finding is driven by the endogenous nature of campaign spending: initiative proponents spend more when their ballot measure is likely to fail. We address this endogeneity by using an instrumental variables approach to analyze a comprehensive dataset of ballot propositions in California from 1976 to 2004. We find that both support and opposition spending on citizen initiatives have strong, statistically significant, and countervailing effects. We confirm this finding by looking at time series data from early polling on a subset of these measures. Both analyses show that spending in favor of citizen initiatives substantially increases their chances of passage, just as opposition spending decreases this likelihood.

Keywords: campaign finance, initiatives, referendums, state government

JEL Classification: H2, H7, P16

Suggested Citation

de Figueiredo, John M. and Ji, Chang Ho and Kousser, Thad, Financing Direct Democracy: Revisiting the Research on Campaign Spending and Citizen Initiatives (September 5, 2010). Available at SSRN: https://ssrn.com/abstract=1672408 or http://dx.doi.org/10.2139/ssrn.1672408

John M. De Figueiredo (Contact Author)

Duke University School of Law ( email )

210 Science Drive
Box 90362
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Duke University - Fuqua School of Business ( email )

Box 90120
Durham, NC 27708-0120
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National Bureau of Economic Research (NBER)

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Cambridge, MA 02138
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Duke Innovation & Entrepreneurship Initiative

215 Morris St., Suite 300
Durham, NC 27701
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Chang Ho Ji

La Sierra University ( email )

Riverside, CA 92515
United States

Thad Kousser

University of California, San Diego (UCSD) - Department of Political Science ( email )

9500 Gilman Drive
Code 0521
La Jolla, CA 92093-0521
United States

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