Campaign expenditures, contributions and direct endorsements: The strategic use of information and money to influence voter behavior

A costly signaling model is presented in which we show how campaign expenditures can buy votes. The model shows that the amount of campaign expenditures may convey the electorate information about the candidate's intended policy. When this model is extended to allow for a contributing interest group, it appears that for campaigning to be informative it is sometimes crucial that campaign funds are supplied by informed third parties. The extension also provides an explanation why interest groups contribute to the candidate's campaign, rather than using direct endorsements; they may need the candidate as an intermediary to filter their opposing interests.