Essays on Economic Incentives in the Political Market

Chapter 1: Presidential candidates in the United States do not intentionally advertise in states without rigorous competition for electoral votes. However, in some areas of non-competitive states, media markets overlap with battleground states, exposing these regions to political ads. These spillover advertisements allow us to examine the relationship between advertisements and individual campaign contributions, with data from the Wisconsin Advertising Project and the Federal Elections Commission. Using propensity score matching within uncontested states, we find that 2008 aggregate giving in zip codes exposed to political ads was approximately ;Chapter 2: Why is negative advertising such a prominent feature of competition in the US political market? We hypothesize that the typical two-candidate race provides stronger incentives for going negative relative to non-duopoly contests: when the number of competitors is greater than two, airing negative ads creates positive externalities for opponents that are not the object of the attack. We investigate the empirical relevance of the fewness of competitors in explaining the volume of negative advertising. Using a cross section of US non-Presidential primary races, we find that duopolies are twice as likely to air a negative ad when compared to non-duopolies.;Chapter 3: The nature of U.S. Presidential primary elections provides incentives for candidates to campaign sequentially. Variation in the duration of primaries over election cycles and changes to the relative ordering of states allow states to be reached in some election cycles and not others. Exploiting this variation in receipt of campaign spending, we construct a novel dataset of state primary information from 1976-2008, quarterly state income in different sectors, and campaign expenditures to determine if hosting a Presidential primary increases income. We find that the exogenous spending during primary campaigns increases income in the hosting state; this effect is largest in the accommodations sector.