The Allocation of Budget in the US:

This thesis investigates the role of the President in the allocation of budget to the individual states. Most of the existing literature focuses on Congressional influence. However, the executive is also an important player in the budgetary process, not only because of his veto power. The main question of our thesis is whether the President uses his power to allocate federal outlays for electoral purposes. In the field of distributive politics there are two dominant hypotheses regarding the targeting of voters. The first hypothesis predicts that the President targets states with a considerable share of swing voters. By providing extra outlays, the executive tries to convince these swing voters to vote for him. The second hypothesis predicts that the President provides more federal budget to states where a considerable share of residents voted for him in the last elections. In an empirical investigation using data on federal outlays in the period 1987-2009, we find significant evidence in favor of the loyal voter hypothesis. States with a considerable share of supporters tend to receive more outlays, while swing states are not rewarded. Our results also show that partisanship is important. More outlays are provided to states where the majority of state delegates in the House is of the same party as the President. These results indicate that the President has a bias towards his own supporters when allocating the federal budget to the states.