Campaign Advertising and Election Outcomes: Quasi-Natural Experiment Evidence from Gubernatorial Elections in Brazil

Joao M. De Mello, PUC-Rio
Bernardo Silveira, NYU

Abstract

Whether campaign advertising influence elections’ outcome is an open question, a paradox given the amount spent on campaigning in general and TV advertising in particular. We argue that the “absence of documentation” is due to the focus of the empirical literature on the United States, where allocation of campaign spending and advertising is decentralized. Exploring a quasi-natural experiment produced by the Brazilian legislation, we overcome the omitted variable and reverse causality problems caused by decentralized allocation. Gubernatorial elections work in a runoff system. While in the first round candidates’ TV time shares are determined by their coalitions’ share of seats in the national parliament, candidates TV time is split equally if a second round is necessary. Using differences between the first and second rounds as a source of exogenous variation, we find a large causal effect of TV advertising on voting outcomes. Since TV advertising is the most important item in campaign expenditures, this result sheds light on the effect of campaign spending on elections outcome