Political Arithmetic: New Evidence on the ‘Small-State Bias’ in Federal Spending
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This paper revisits the literature identifying a small-state bias in federal spending, according to which the distribution of federal funds favors the less populous states because they are ‘overrepresented’ in the U.S. Senate. Estimating a panel data model of die determinants of government spending per million capita across the 50 states over a longer time period [1972- 2000] than studied hitherto, and controlling for heterogeneity in the memberships of the House and Senate by including the tenures of die states’ congressional delegations, we report evidence supporting the existence of a bias toward states that are overrepresented in both chambers. Our key finding, however, is that the small-state bias is sensitive to the time period considered.
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