Verifiability and neologism-proofness in a Sender-Receiver game

Matthew Ryan and Rhema Vaithianathan

Journal of Economic Behavior & Organization, 2011, vol. 79, issue 3, 256-262

Abstract: Abstract This paper contributes to the literature on information transmission in Sender-Receiver games. We compare cheap-talk games to games with verifiable messages (persuasion games). We consider equilibria in which the Sender's private information (type) is fully revealed to the Receiver. We show that if a fully revealing perfect Bayesian equilibrium (PBE) exists when talk is cheap, then one also exists when messages are verifiable. We also show that this is not the case for neologism-proof PBE's. We construct an example in which full revelation can be sustained as a neologism-proof PBE outcome when talk is cheap, but not when messages are verifiable.

Keywords: Cheap; talk; Verifiable; Separating; equilibrium; Neologism-proof (search for similar items in EconPapers)
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:79:y:2011:i:3:p:256-262

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