Is Spending More Potent For or Against a Proposition? Evidence from Ballot Measures

Authors


  • I would like to thank three anonymous referees, Bruce Cain, John de Figueiredo, Jonathan N. Katz, John Matsusaka, Nolan McCarty, and participants of the Symposium on the Impact of Direct Democracy for helpful comments and suggestions. A previous version of this article was entitled “Is Interest Group Pressure To Preserve The Status Quo More Effective Than To Change It? Evidence From Ballot Measures.” Financial support from the National Science Foundation is gratefully acknowledged. Jennis Taylor and Richard Wallick provided excellent research assistance.

Thomas Stratmann is professor of economics, George Mason University, Department of Economics, 1D3 Carow Hall, 4400 University Dr., Fairfax, VA 22030 (tstratma@gmu.edu).

Abstract

The recent academic literature suggests that pressure from special interest groups has little or no influence on whether initiatives and referendums are passed or defeated. Further, there is a consensus that, to the degree that groups' campaigning is important for explaining outcomes, groups opposing the initiative and favoring the status quo have an advantage over groups that support change. These studies have not considered that interest groups campaign strategically and therefore that campaigning is endogenous in ballot measure elections. This study examines the effect of campaigning on ballot proposition elections and develops a research design that accounts for strategic and endogenous campaign advertising. The research design uses a two-way fixed-effects model to estimate the effect of interest group pressure on ballot measure outcomes. The data are based on television advertising for or against California ballot measures from 2000 to 2004. The results show that supporting and opposing interest groups' campaigning has a quantitatively important and statistically significant influence on ballot measure outcomes. The campaigning of supporting interest groups is at least as productive as that of opposing interest groups.

Ancillary