The Incumbent Spending Puzzle*


Direct correspondence to Christopher S. P. Magee, Department of Economics, Bucknell University, Lewisburg, PA 17837 <>. The author acknowledges an anonymous referee for helpful comments and Gary Jacobson for providing data on challengers in House elections. The author will share all data and coding information with those interested in replicating the study.



This article seeks to explain the puzzle of why incumbents spend so much on campaigns despite most research finding that their spending has almost no effect on voters.


The article uses ordinary least squares, instrumental variables, and fixed-effects regression to estimate the impact of incumbent spending on election outcomes. The estimation includes an interaction term between incumbent and challenger spending to allow the effect of incumbent spending to depend on the level of challenger spending.


The estimation provides strong evidence that spending by the incumbent has a larger positive impact on votes received the more money the challenger spends.


Campaign spending by incumbents is most valuable in the races where the incumbent faces a serious challenge. Raising large sums of money to be used in close races is thus a rational choice by incumbents.