I investigate how government-funded subsidies vary between electoral districts within an archetypal proportional system: Norway. Political parties competing in this closed-list proportional system, where voters select a party at the ballot box rather than an individual candidate, engage in policy targeting – that is, parties provide economic benefits selectively to geographically-defined groups. Political parties target economic benefits to those districts where they have relatively more supporters. Districts where the largest government party won a greater share of the vote in the previous election receive more generous subsidies, all else equal. I report qualitative evidence from interviews of government ministers and bureaucrats responsible for the administration of subsidy programs. These interviews confirm the importance of electoral politics and economic geography for governments’ spending decisions and illustrate the mechanisms governments use to target subsidies. The government directly controls the allocation of subsidies to sectors via the budget process. The government indirectly controls the allocation of subsidies to firms within a sector via control of the bureaucracy. To control bureaucratic decisions over firm-level subsidies, the government uses letters of assignment and biannual meetings.