Abstract
I study a model of electoral competition where both economic policy and politicians’ effort affect voters’ payoff. If voters cannot distinguish the effect of policy and effort, politicians acquire an implicit incentive to exert effort. This incentive can last through every period in an infinitely repeated game as long as there is uncertainty in every period regarding the policy’s effectiveness. However, as uncertainty decreases, the set of effort-exerting equilibria shrinks. Even if the electorate manages to hold the politician accountable on the effort dimension, it cannot eliminate politicians’ inefficient persistence in policy choice. This situation occurs even when changing the existing policy would come at a small cost.