The Government Financial Advantage of Early Elections: Evidence from UK MP Candidate Spending

Abstract

In many parliamentary democracies, incumbents retain the right to call early elections. This is thought to provide incumbent governments with an advantage due to the ability to time elections to favorable economic conditions. This article explores an additional incumbency advantage of early elections. Due to information asymmetry about election timing, government parties can better plan fundraising in early elections years compared to non-government parties, which gives government parties a relative financial advantage. This proposition is tested on campaign spending data from over 50,000 British parliamentary candidates 1945–2019. The results support the argument. Government party candidates gain a relative financial advantage in early elections years compared to scheduled election years. The effect is found only for non-incumbent candidates and was eliminated by the Fixed-term Parliaments Act of 2011, which removed government early election calling. The results suggest that government election calling power provides incumbent government parties with a relative financial advantage.