The political benefits of the monoculture: Estimating the electoral effect of the market facilitation program

Does the distribution of government transfers affect elections? We analyze a natural experiment in the 2019 wave of the US Department of Agriculture's Market Facilitation Program (MFP). The 2019 MFP allocated $14.5 billion via a formula combining historical production data and commodity-specific trade damages. We show how a methodological quirk resulted in arbitrary variation in these damages that propagated through the formula into excessive county-level compensation rates. We estimate the effects of this payment shock using a novel, design-based, randomization inference approach to account for complex dependencies across US counties. We find that counties receiving greater compensation rates, on average, have higher two-party Republican presidential vote shares in the 2020 election. Instrumenting for actual 2019 MFP disbursements, we find an additional $1 million in payments to a county increased that county's 2020 two-party Trump vote share by about .18 percentage points on average. Had the 2019 MFP maintained the spending levels of the 2018 wave, we estimate that Candidate Trump's two-party vote share would have been .117 percentage points lower nationally, with particularly pronounced effects in swing states like Arizona (.41 percentage points) and Georgia (.159 percentage points).