Public Choice

, Volume 35, Issue 1, pp 97–120

The allocation of political monies: Economic interest groups


  • W. P. Welch
    • University of Pittsburgh

DOI: 10.1007/BF00154752

Cite this article as:
Welch, W.P. Public Choice (1980) 35: 97. doi:10.1007/BF00154752

Conclusion and summary

We have constructed two models of how economic interest groups allocate their campaign monies between candidates for the same legislative house. The models make contrasting assumptions regarding an interest group's strategy for affecting policy outcomes. One model assumes contributions are given to affect election probabilities while the other assumes that contributions are exchanged for political favors. The validity of these assumptions can best be examined by testing the predictions of the two models.

The contribution functions of seven economic interest groups to 1974 candidates for the U.S. House were estimated with Tobit analysis. A beta functional form was used, with expected vote percentage and voting score as independent variables. For all seven groups, the mode of this function was significantly different from fifty percent of the expected vote, supporting the prediction that economic contributors prefer likely winners. This result tends to support the assumption that an economic interest group contributes in order to obtain political favors, not to affect electoral outcomes. Although we cannot exclude the possibility that some mixed strategy is followed, the strategy described by the exchange model appears to have dominated economic interest group giving in the 1974 U.S. House races.

Copyright information

© Martinus Nijhoff Publishers bv 1980