Sequential Cheap Talk from Advisors with Reputation

Junghun Cho

CERGE-EI Working Papers from The Center for Economic Research and Graduate Education - Economics Institute, Prague

Abstract: I examine two-period sequential cheap talk in situations where the decision maker seeks advice from two advisors, each of whom knows the type of the other advisor. By considering the current payoff (which is determined by the message of each advisor) and the future payoff (which is connected with the reputation of each advisor), I examine conditions which guarantee the existence of both good and bad reputation effects. Compared to situations of simultaneous cheap talk, the decision maker loses information more easily if he seeks advice sequentially.

Keywords: Cheap talk; reputation. (search for similar items in EconPapers)
JEL-codes: D82 D83 (search for similar items in EconPapers)
Date: 2008-06
New Economics Papers: this item is included in nep-cta and nep-hpe
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