The Design and Price of Influence

Raphael Boleslavsky and Aaron Kolb

Papers from arXiv.org

Abstract: A sender with private preferences would like to influence a receiver's action by providing information through a statistical test. The technology for information production is controlled by a monopolist intermediary, who offers a menu of tests and prices to screen the sender's type. We characterize the intermediary's optimal screening menu and the associated distortions, which may benefit the receiver by increasing test informativeness. Because of these distortions, seemingly unfavorable changes in the prior belief may actually benefit the sender. In extensions, we study (i) a stronger intermediary who can commit to a ``coercive'' test to punish non-participation and (ii) a weaker intermediary who cannot control test design but can charge for access.

Date: 2024-08, Revised 2025-02
New Economics Papers: this item is included in nep-cta, nep-des, nep-exp, nep-gth and nep-mic
References: View complete reference list from CitEc
Citations:

Downloads: (external link)
http://arxiv.org/pdf/2408.03689 Latest version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:2408.03689

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().