The Paradox of Party Funding

This chapter addresses the role of public funding in party organizational transformation. Focusing mainly on European democracies, and using the new systematic data obtained from the Political Party Database, this chapter makes two contributions to the party politics literature. First, a range of existing findings about the importance of state subsidies for party life are re-examined, probing in particular the extent to which party incomes depend on public funding, as opposed to private donations and membership fees. Second, the association between parties’ dependence on state subsidies and party organization is explored, probing in particular the relationship between public monies and the size of parties’ memberships. Unlike the first exploration, which largely confirms most existing conclusions about the patterns of party financing, the findings from the second exploration appear to be more challenging: contrary to usual expectations, state funding of political parties does not necessarily undermine party membership.