Research finds that corporate lobbying hasn’t bought more favorable tax treatment from state governments

It is often argued that, at the federal and state level, “the rich” and their corporations use their wealth to influence policy in their economic interest. An example is found in People, Power, and Profits: Progressive Capitalism for an Age of Discontent, a recent book by Nobel Prize-winning economist Joseph E. Stiglitz, which argues that:

Those with money and power have used their power in politics to write the rules of the economic and political game in ways that reinforce their advantage.

A new paper casts doubt on this.

In “Corporate political spending and state tax policy: Evidence from Citizens United,” economists Cailin Slattery, Alisa Tazhitdinova, and Sarah Robinson ask: “To what extent is U.S. state tax policy affected by corporate political contributions?”

To answer this question, they look at changes in state corporate tax policy following the Supreme Court’s January 2010 ruling in Citizens United v. Federal Election Commission. This decision overturned a 20-year precedent and prohibited governments from restricting independent political expenditures by organizations. This, the authors note, allowed “corporations to spend on elections in 23 states which previously had spending bans.”

What were the results? The authors conclude that:

Ten years after the ruling and for a wide range of outcomes, we are not able to identify statistically significant effects of corporate independent expenditures on state tax policy, including tax rates, discretionary tax breaks, and tax revenues. 

If corporations have been spending their money lobbying for more favorable tax treatment from state governments, they haven’t got it.