Salvation for the Spendthrift Incumbent: Reestimating the Effects of Campaign Spending in House Elections

This paper reevaluates Jacobson's well-known finding (1978, 1980, 1984, 1985) that campaign spending by House incumbents has little influence on the vote. Analysis of the 1978 House election shows that three forms of model misspecification cause Jacobson to underestimate the effect of incumbent expenditures: failure to control for the quality of the challenger, inattentiveness to interaction effects, and inadequate treatment of reciprocal causation. When these biases are corrected, the marginal effect of incumbent spending is found to be substantial and, under certain circumstances, on par with the effect of challenger spending. In addition, challenger quality is shown to be an important determinant of the vote, particularly when the challenger spends heavily on his or her campaign. These findings imply that revisions to Jacobson's policy recommendations are necessary if House races are to be made more competitive.