Do Incumbent Campaign Expenditures Matter?

Abstract

Previous research reached the puzzling conclusion that an incumbent cannot increase his vote by increasing his campaign expenditures. This paper reexamines the finding by developing a theory of campaign expenditures. The theory is then used to specify an econometric model; previous studies did not develop a theory prior to specifying their econometric models. The new empirical results demonstrate that, in most races, incumbent expenditures do matter.