Campaign contributions and government grants

Abstract

This paper investigates the extent to which campaign contributions influence government grant allocation. I compare federal election campaign contributions from nonprofit officers, directors, trustees, and foundation managers to the government grants those nonprofits obtain. This unique dataset combines nonprofit financial audits with FEC contributions records by matching employee names. Aggregating individual contributions and yearly audits, I construct a nonprofit panel, and I find an association between government grants and nonprofit employee contributions. Results indicate a robust positive relationship with a substantial return to contributions.