Public Party Funding and Political Participation: Evidence from Swedish Municipalities

Abstract: Across most contemporary democracies, different provisions of public funding for parties have been introduced in post-war times. Parties have come to rely heavily on this subsidy, yet, the effects of this change in party finance remains poorly understood. Sweden is no exception to this rule, where parties receive considerable amounts of funding from both state and local authorities. In this thesis, I utilize rich panel data on Swedish municipalities between 1998 and 2014 to study the effects of different levels of municipal party funding on two forms of political participation: Turnout in municipal elections, and membership in the Green Party. I apply time and unit fixed effects and a vector of control variables in regression models. Overall, estimated coefficients are negative for simpler specifications regarding turnout, and otherwise statistically inseparable from zero. This suggests that municipal party support does not live up to its express goal of strengthening local democracy, at least not in terms of increasing political participation, but might not necessarily be detrimental to it either.