Campaign Contributions or Direct Endorsements?

  • Randolph Sloof


The basic signaling game presented in the previous chapter provides a simple explanation for the empirical observation that campaign expenditures buy votes (cf. Morton and Cameron, 1992). The mere fact that a candidate spends a lot of money on political advertisements may indicate that he will implement a policy platform the electorate likes. In the basic political campaigning model introduced in Section 3.2 it is assumed that the candidate has to rely on his own funds. In reality, however, the campaign chest of a candidate is often larded by interest groups. Hence, when a candidate is able to spend a lot of money on a campaign, this typically indicates that he received a large amount of contributions. In this respect Grossman and Helpman (1994, p. 836) suggest that the size of contributions received shows the candidate’s ability as a fundraiser, and thus serves as a kind of indirect endorsement. This suggestion in turn raises two interesting questions, one with respect to the explanation of the impact of costly campaigns, and another with respect to an interest group’s choice between direct and indirect endorsements. Firstly, are there circumstances under which political campaigns need contributions from interest groups in order to be effective? Secondly, why would interest groups contribute to the campaign of a candidate or party when they can also reach out to the voters directly via direct endorsements?


Interest Group Information Transfer Information Revelation Political Campaign Equilibrium Path 
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Copyright information

© Springer Science+Business Media New York 1998

Authors and Affiliations

  • Randolph Sloof
    • 1
  1. 1.University of AmsterdamThe Netherlands

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