Working Paper: NBER ID: w18500
Authors: Shawn Kantor; Price V. Fishback; John Joseph Wallis
Abstract: The critical election of 1932 represented a turning point in the future electoral successes of the Democrats and Republicans for over three decades. This paper seeks to measure the importance of the New Deal in facilitating the Democrats' control of the federal government well into the 1960s. We test whether long-differences in the county-level electoral support for Democratic presidential candidates after the 1930s can be attributed to New Deal interventions into local economies. We also investigate more narrowly whether voters rewarded Roosevelt from 1932 to 1936 and from 1936 to 1940 for his efforts to stimulate depressed local economies. Our instrumental variables estimates indicate that increasing a county's per capita New Deal relief and public works spending from nothing to the sample mean ($277) would have increased the long-run support for the Democratic party by 10 percentage points. We further find that the long-run shift toward the Democratic party after 1928 was not a function of the Roosevelt landslide victory in 1932. Roosevelt's ability to win over voters during the 1936 and 1940 elections, however, did matter for the long-term.
Keywords: New Deal; Democratic Realignment; Electoral Support; Instrumental Variables
JEL Codes: H5; N42
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| New Deal spending (H56) | long-run support for the Democratic Party (D72) |
| New Deal spending (H56) | electoral support for Roosevelt (K16) |
| allocation of New Deal funds (H84) | OLS estimates of electoral support (D79) |
| AAA spending (L83) | retail sales (L81) |
| AAA spending (L83) | farm laborers (J43) |
| long-term shift toward the Democratic Party (J79) | electoral outcomes in 1936 and 1940 (K16) |