Partially Revealing Campaign Promises

Candidates competing for political office give promises to voters. There are no legal restraints preventing incumbents from breaking their electoral promises. So why is campaign talk influential? We propose that a candidate's campaign promises (cheap-talk) are a partially revealing signal of her policy preference type. The incumbent's policy choice is yet another (costly) signal of her type. The incumbent keeps her electoral promises in order to preserve ambiguity about her type, which is necessary to assemble a winning majority for re-election. She keeps her promises regardless of information about the efficiency of different public policies which she receives upon taking office. Therefore, campaign promises generate inefficiencies in public policy.