Garbling an evaluation to retain an advantage

Ascencion Andina-Diaz and Jose A. Garcia-Martinez

No 2023-04, Discussion Papers from Nottingham Interdisciplinary Centre for Economic and Political Research (NICEP)

Abstract: We study the effects of introducing interpersonal comparisons on the decisions made by career concerned experts. We consider competition between two experts who may differ in their initial reputation. We obtain that whereas full transmission of experts' private information is an equilibrium when experts have the same initial reputation, this is not necessarily the case when they are heterogenous. In this case, we identify an incentive for the stronger expert to deliberately misreport her signal, aiming at garbling the evaluation of the principal to retain her advantage. In equilibrium, this expert may even completely contradict her signal and the other experts' decision. We discuss the implications of our results to different contexts, such as reaching consenses in a society, competition for attention, and misconception of the market's evaluation system.

Keywords: Interpersonal comparisons; heterogenous expertise; career concerns; probability of feedback. (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-mic
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