Caps on political contributions, monetary penalties and politician preferences

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Title: Caps on political contributions, monetary penalties and politician preferences
Authors: Pastine, Ivan
Pastine, Tuvana
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Date: 7-Sep-2009
Abstract: With politician preferences over policy outcomes, the effect of a contribution cap with monetary penalties for exceeding the cap is starkly different from the case with an indifferent politician. In contrast to Kaplan and Wettstein (AER, 2006) and Gale and Che (AER, 2006), a cap is never neutral on the expected cost of contributions nor on the policy outcome. Furthermore more restrictive caps can lead to increased aggregate contributions. When the penalty for exceeding the cap is small enough that it is impossible to suppress all contributions, the influence of money on policy is minimized with a binding but non-zero cap and maximized with no cap.
Funding Details: Not applicable
Type of material: Working Paper
Publisher: University College Dublin. School of Economics
Keywords: All-pay auctionCampaign finance reformSoft moneyExplicit ceilingBCRA
Subject LCSH: Campaign funds--Law and legislation--Ireland
Campaign funds--Mathematical models
Ireland--Politics and government
Language: en
Status of Item: Not peer reviewed
Appears in Collections:Economics Working Papers & Policy Papers

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