Association for Public Policy Analysis & Management

This paper uses a regression discontinuity design to estimate the causal effect of incumbency status on the probability of winning a mayoral election in Chile. Moreover, it exploits a campaign reform that limited advertisement and changed the way in which campaigns were financed to study some of the potential determinants of this electoral advantage. I find that there exist a significant incumbency advantage only after the reform implemented in 2016. For the elections in 2008 and 2012, I do not find statistically significant advantage, however in 2016 election being the incumbent increases significantly the unconditional probability of being elected by between 32-39%. This finding suggests that the reform benefited the incumbents. We interpret the results using an electoral contest model with spending caps where the incumbent enjoys an initial voter disposition advantage and a greater fund raising efficiency while the challenger enjoys greater campaign effectiveness.