Full revelation under optional verification

Simon Schopohl

Economics Letters, 2019, vol. 176, issue C, 14-16

Abstract: We analyze a Sender–Receiver game in which the Sender can choose between a costless cheap-talk message and a costly verifiable message. In a discrete setting we state conditions under which the Receiver always learns the true state while the Sender uses different message types in different states. On the contrary we show that such a fully revealing equilibrium does not exist if the state and action space are continuous.

Keywords: Cheap-talk; Communication; Costly disclosure; Full revelation; Sender–receiver game; Verifiable information (search for similar items in EconPapers)
JEL-codes: C72 D82 (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:176:y:2019:i:c:p:14-16

DOI: 10.1016/j.econlet.2018.12.021

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