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Campaign finance

From Academic Kids

Campaign finance refers to the means by which money is raised for political election campaigns. Campaign finance system generally refers to prevailing fundraising practices as well as the laws and governing those practices and the use of public funds to attract votes.

It is commonly alleged that campaign finance based on promises of increased entitlements in exchange for votes may lead to de facto corruption in democratic systems, even though such promises may be legal. Political analysts who value civic participation have observed that the main problem of tax money in politics is its use to purchase votes as demonstrated by the growth of government spending in most western democracies and the increases in the role of government in social programs.

In disciplines such as economics and public policy, public choice theory and collective action theory attempt to understand the effects of this kind of abuse of public power on the outcomes of political processes. The problems is compound by seniority systems in legislatures which give more power to re-elected representatives than to new ones that may not be able to deliver on their promises of more government largess.

Democratic countries have differing views on what is legal and what types of donations to political parties and campaigns are acceptable. For instance, the United States has a fairly liberal view of campaign contributions, and the campaigns of most prominent American politicians are funded by a variety of sources. Other countries take a more restricted view, for instance making illegal contributions from corporations.


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