A model of policy timing: Hedging, pandering, and gambling

Abstract I study a political agency model where a reelection‐seeking politician chooses when to make policy and a voter learns about the politician's competence from its timing, substance, and outcome. It takes time for the politician to receive information about which policy is in the voter's best interest and for the effect of policy to be observed. Due to perverse electoral incentives, politicians engage in three behaviors that limit electoral accountability. First, politicians hedge by delaying policy to hide potential policy failure from voters. Second, politicians pander late in the electoral cycle where they cannot credibly campaign on the success of an unpopular policy. Third, in the hope of producing visible policy success, politicians gamble by making a prompt policy choice when it is in the voter's best interest to delay. I show how politicians use these behaviors strategically in response to different contingencies and study their implications for electoral accountability.