For a Few Euros More

Abstract

Although perceived by candidates and parties as important in affecting political outcomes, the link between spending and success in multi-candidate, multiparty election campaigns remains unproven. Not only are there relatively few studies of campaign spending effects in multi-party systems, there are none examining the effect under the Single Transferable Vote (STV) electoral system. Our study examines spending effects in the Irish local elections of 1999 using STV with district magnitudes between 3 and 7 seats, contested by a median of 10 candidates in each district. Using detailed data on 1,838 candidates from 180 local constituencies and 30 councils, we provide precise estimates of the relationship between campaign spending at the candidate level in each district and electoral success, including the probability of winning. In a context where spending is miniscule relative to other contexts, and takes place under a completely different electoral system, our results echo previous studies from other contexts showing a strong effect of challenger spending and only weak effects of incumbent spending. Once allowance is made for the endogeneity of incumbent spending, however, we find a much less substantial difference between the effectiveness of spending by challengers and by incumbents, except on the marginal effect of spending on the probability of winning, where challenger spending is shown to be much more important.