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Persuasive communication when the sender's incentives are uncertain

Paan Jindapon () and Carlos Oyarzun

Journal of Economic Behavior & Organization, 2013, vol. 95, issue C, 111-125

Abstract: We study persuasion in a modified Crawford–Sobel sender–receiver game in which the receiver makes a binary decision to accept or reject a good recommended by the sender. The good's quality and the sender's type (neutral or biased) are not observable to the receiver. These alterations yield a simple model and a unique truth-telling equilibrium in which neutral senders who observe different qualities fully separate but can only communicate low quality levels accurately. Biased senders adopt a mixed strategy that can successfully persuade the receiver to accept the good most of the time. When the sender's degree of bias is continuously distributed, a truth-telling equilibrium does not exist. Nonetheless, a partition equilibrium exists for any given number of partitions on the message space.

Keywords: Strategic communication; Persuasion; Perfect Bayesian equilibrium (search for similar items in EconPapers)
JEL-codes: C72 D82 L15 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:95:y:2013:i:c:p:111-125

DOI: 10.1016/j.jebo.2013.08.015

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Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D.

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