A Congressional Theory of the Size of Government

Abstract

In this paper, we examine the implications of the party cartel model of congressional policy making on the level of redistributional social welfare spending in the United States. The party cartel model predicts an inverse relationship between the level of spending on social welfare programs and median family income of the district that the median member of the majority party represents. Specifically, the higher the median district income of the median member of the majority party, the smaller the amount of social welfare spending Congress will allocate. To test this hypothesis, we estimate a random coefficients model using time series cross sectional data on congressional Budget Authorization for redistributional social welfare spending. We find that for each $1000 increase in median district income for the median member of the majority party, each redistributional Budget Authority sub-function decreases by an average of $489 million (for a total decrease of $3.91 billion overall). Therefore, the party cartel model appears to be a significant predictor of the level of income redistribution in the U.S.