State governments as entrepreneurs in securing federal benefits for their citizens

Cooperative federalism provides state governments the ability to shape federal policy in line with subgovernment interests. Although a large literature explores how states promote their goals using federal grants-in-aid, little attention has been paid to how states use their self-assigned application assistance role for federal programs to advance their own agendas. Using data from the Veterans' Disability Compensation program, we find evidence that state governments'efforts to provide application assistance affect state veterans' access to federal benefits in ways that generate state tax revenue. Our findings highlight the importance of state governments as actors in federal programs that are, at first glance, completely federalized, and have implications for scholarship on federalism, state politics, and social welfare policy.