Risky shifts as multi-sender signaling

Takakazu Honryo

Journal of Economic Theory, 2018, vol. 174, issue C, 273-287

Abstract: This paper addresses the issue of risky shifts by a multi-sender signaling game. Senders compete in making proposals to be adopted by a group, hence they try to signal that they have the ability to correctly observe the state. This paper shows that senders tend to avoid making a moderate proposal, because a moderate proposal signals incompetence. When facing a moderate and a risky proposal, the group tends to adopt the risky one, and we have risky shifts as a result.

Keywords: Signaling game; Risky shifts (search for similar items in EconPapers)
JEL-codes: D82 (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:174:y:2018:i:c:p:273-287

DOI: 10.1016/j.jet.2018.01.003

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