The Comparative Statics of Persuasion

Gregorio Curello and Ludvig Sinander

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: In the canonical persuasion model, comparative statics has been an open question. We answer it, delineating which shifts of the sender's interim payoff lead her optimally to choose a more informative signal. Our first theorem identifies a coarse notion of 'increased convexity' that we show characterises those shifts of the senders interim payoff that lead her optimally to choose no less informative signals. To strengthen this conclusion to 'more informative' requires further assumptions: our second theorem identifies the necessary and sufficient condition on the sender's interim payoff, which strictly generalises the 'S' shape commonly imposed in the literature. We identify conditions under which increased alignment of interests between sender and receiver lead to comparative statics, and study a number of applications.

Pages: 71
Date: 2024-06
New Economics Papers: this item is included in nep-des, nep-gth and nep-mic
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