Essays on campaign finance and political power

This thesis is concerned with the influence of campaign finance on the interplay between political power and electoral competition in the United States and the United Kingdom. The thesis considers both the donation and expenditure sides of campaign finance: In the context of U.S. state and federal legislative elections (1980-2014), I study how political power affects the allocation of campaign contributions, and in the context of U.K. House of Commons elections (1885-2010), I examine how campaign spending restrictions affect political power via electoral behavior. The three papers which make up the construct of the thesis answer the following questions: (i) What is the financial value of incumbency status, and who generates it? (ii) Who values legislative agenda setters, and why do they do so? (iii) What are the electoral consequences of statutory limits on campaign expenditure? I argue that campaign donors make their contributions to powerful politicians in exchange for access to the policy-making process, and that the power of these politicians is sustained, at least in part, due to these contributions. In the first paper, I document that U.S. incumbent legislators enjoy sizeable financial advantages compared to challengers, and I demonstrate that this advantage is the result of donations from access-seeking industries. In the second paper, I show that U.S. legislators who are institutionally endowed with agenda-setting powers are given special treatment by campaign donors. I document that donors with vested economic interests in regulatory policy place great value on agenda-setting legislators – in particular when institutions provide these legislators with the authority to block new legislation. In the final paper, I study the consequences of campaign spending limits in the context of U.K. House of Commons elections. I show that unrestrained spending reduces electoral competition, promotes professionalized campaigns, and benefits incumbents and centerright parties