Robustness of Full Revelation in Multisender Cheap Talk

Margaret Meyer, Ines Moreno de Barreda and Julia Nafziger

No 11224, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This paper studies information transmission in a two-sender, multidimensional cheap talk setting where there are exogenous constraints on the (convex) feasible set of policies for the receiver and where the receiver is uncertain about both the directions and the magnitudes of the senders' bias vectors. With the supports of the biases represented by cones, we prove that whenever there exists an equilibrium which fully reveals the state (a FRE), there exists a robust FRE, i.e. one in which small deviations result in only small punishments. We provide a geometric condition, the Local Deterrence Condition, relating the cones of the biases to the frontier of the policy space, that is necessary and sufficient for the existence of a FRE. We also construct a specific policy rule for the receiver, the Min Rule, that supports a robust FRE whenever one exists.

Keywords: Cheap talk; Information transmission; Multisender; Full revelation; Robustness (search for similar items in EconPapers)
JEL-codes: C72 D82 D83 (search for similar items in EconPapers)
Date: 2016-04
New Economics Papers: this item is included in nep-gth and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Related works:
Working Paper: Robustness of Full Revelation in Multisender Cheap Talk (2019)
Working Paper: Robustness of Full Revelation in Multisender Cheap Talk (2016)
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