Mega-Donors and Representation of the Wealthy in the Wake of Citizens United

49 Pages Posted: 11 Mar 2024

See all articles by Ilona Babenko

Ilona Babenko

Arizona State University

Viktar Fedaseyeu

China Europe International Business School (CEIBS)

Guosong Xu

Rotterdam School of Management, Erasmus University

Date Written: February 13, 2024

Abstract

We document that in the wake of the Supreme Court's Citizens United decision, which increased in the ability of the wealthy to finance political campaigns, the share of total electoral giving attributable to top 1% donors increased by 2.7 times. Further, we find that the voting by U.S. legislators became more responsive to the preferences of the wealthy post-Citizens United and less responsive to the preferences of the less affluent. The increase in legislators' alignment with the wealthy is most pronounced for the bills that deal with fiscal matters and for those bills on which the preferences of higher- and lower-income individuals diverge. Finally, it is the politicians who receive a larger share of their campaign funding from the top 1% donors that are more likely to shift their voting toward the preferences of the wealthy. Overall, our results highlight the importance of campaign finance in changing the nature of political representation in the United States.

Keywords: Wealthy Donors, Campaign Contributions, Citizens United, Political Representation, Campaign Finance

JEL Classification: D72, D31, D63

Suggested Citation

Babenko, Ilona and Fedaseyeu, Viktar and Xu, Guosong, Mega-Donors and Representation of the Wealthy in the Wake of Citizens United (February 13, 2024). Available at SSRN: https://ssrn.com/abstract=4723689 or http://dx.doi.org/10.2139/ssrn.4723689

Ilona Babenko (Contact Author)

Arizona State University ( email )

Department of Finance
W.P. Carey School of Business
Tempe, AZ 85287
United States

Viktar Fedaseyeu

China Europe International Business School (CEIBS) ( email )

Shanghai-Hongfeng Road
Shanghai 201206
Shanghai 201206
China

HOME PAGE: http://https://www.ceibs.edu/fviktar

Guosong Xu

Rotterdam School of Management, Erasmus University ( email )

RSM Erasmus University
PO Box 1738
Rotterdam, 3062 PA
Netherlands

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