Campaign financing and revenue bargaining in Tanzania and Uganda

Abstract

Abstract This chapter analyses the link between campaign financing and revenue bargaining. We argue that campaign financing, especially for the incumbent president, provides more bargaining power for campaign donors than paying taxes. Because increased electoral competition makes ruling parties more dependent on private campaign funding and use of government budgets, such dependency enhances the bargaining power of campaign funders. Our findings show that presidential campaign costs in Uganda, where elite fragmentation is considerable, increased significantly in the election cycles of the 2010s compared to Tanzania. What is more, in both countries, expenditures are higher for the incumbents than for opposition candidates, and the government budget is a much more important source of funding for presidential elections in Uganda than in Tanzania. Also, private sources for the ruling party are mainly individuals and domestic companies who successfully bargain for reduced taxation and access to rents.