Law Commons^™

The Same Side Of Two Coins: The Peculiar Phenomenon Of Bet-Hedging In Campaign Finance, Jason Cohen

Northern Illinois University Law Review

This paper addresses the propensity of large donors to make financial contributions to competing candidates or party organizations during the same election cycle--for example, giving money to both Bush and Kerry during the 2004 presidential race. This practice, here termed "'bet-hedging," is analyzed in strategic and game-theoretic terms. The paper explores the prevalence of bet-hedging, the possible motivations behind the practice, and the informational concerns surrounding it. Bet-hedging, above all other donation practices, carries a unique implication of ex post favor-seeking. A donor who prefers one side over the other at least partially cancels out its own contribution by hedging …