Public Money Talks Too: How Public Campaign Financing Degrades Representation

Abstract

Does public campaign financing improve representation by reducing politicians' reliance on wealthy donors as advocates claim, or does it worsen representation by expanding the candidate marketplace to give extreme and nonrepresentative candidates an electoral boost? We conduct a novel analysis of public financing programs in Arizona, Connecticut, and Maine to causally identify the effect of a legislator's funding status on how closely she represents constituent preferences. Using multiple identification strategies, we show that candidates who exclusively use public campaign financing are more extreme and less representative of their districts than nonpublicly financed candidates. Our findings add new evidence to the electoral reform debate by demonstrating how replacing private campaign donations with public financing can actually damage substantive representation. We also advance the scholarship on how institutions affect substantive representation and candidate positioning as they respond to new campaign financing structures.