  Political campaigns are among the most sophisticated marketing exercises in
the United States. As part of their marketing communication strategy, an
increasing number of politicians adopt social media to inform their
constituencies. This study documents the returns from adopting a new
technology, namely Twitter, for politicians running for Congress by focusing on
the change in campaign contributions received. We compare weekly donations
received just before and just after a politician opens a Twitter account in
regions with high and low levels of Twitter penetration, controlling for
politician-month fixed effects. Specifically, over the course of a political
campaign, we estimate that the differential effect of opening a Twitter account
in regions with high vs low levels of Twitter penetration amounts to an
increase of 0.7-2% in donations for all politicians and 1-3.1% for new
politicians, who were never elected to the Congress before. In contrast, the
effect of joining Twitter for experienced politicians remains negligibly small.
We find some evidence consistent with the explanation that the effect is driven
by new information about the candidates, e.g., the effect is primarily driven
by new donors rather than past donors, by candidates without Facebook accounts
and tweeting more informatively. Overall, our findings imply that social media
can intensify political competition by lowering costs of disseminating
information for new entrants to their constituents and thus may reduce the
barriers to enter politics.
