When does monitoring hurt? Endogenous information acquisition in a game of persuasion

Tsz-Ning Wong and Lily Ling Yang

Economics Letters, 2018, vol. 163, issue C, 186-189

Abstract: We study a persuasion game between a decision maker and an expert. Before communication, the expert searches for an evidence about the state of nature. Higher effort leads to a higher probability of discovery. We show that, contrary to everyday experiences, monitoring of effort is always suboptimal if the expert’s bias is large, yet sometimes optimal if the expert’s bias is small.

Keywords: Information acquisition; Persuasion; Voluntary disclosure (search for similar items in EconPapers)
JEL-codes: D82 D83 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:163:y:2018:i:c:p:186-189

DOI: 10.1016/j.econlet.2017.12.001

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