A growing body of research demonstrates that parties are vital for the health of democracy. While party activities are therefore increasingly supported by direct public subsidies, we know relatively little about the ways in which parties spend this money. Using an original dataset of intra-party cash transfers, this article examines resource allocation in three major Mexican parties. The analysis demonstrates that parties’ spending patterns differ. Decentralization, which has increased the power and prestige of subnational office, prompts all parties to focus spending on states holding local elections. Parties with a regionalized support base, however, invest primarily in states where they are competitive. This tendency to favour party strongholds has important implications for party system development, particularly for party system nationalization, as well as for emerging work on subnational authoritarianism.