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As a teacher, I would be appalled if my school were to grade solely on effort. I think that it is fine to base a little bit of a student's grade on performance, but not much of the grade and certainly not all of it.
In life, we do not simply get graded on effort. We do not award championships to whichever sports team tried the hardest. We reward people based on their performances because that is what really counts. Effort is very good from a moral point of view, but results are what determine (for example) if a business makes a profit or goes broke. Therefore, we need to grade students on what they accomplish, not on how hard they try.
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