Strategic Communication with Negative Reciprocity and Endogenous Preferences

Ran Eilat and Kfir Eliaz

No 21360, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We incorporate negative reciprocity into strategic information transmission and study how a receiver’s response to perceived manipulation shapes equilibrium outcomes. We examine both an information-design environment, in which the sender can commit to an information structure, and a cheap-talk environment, in which commitment is not possible. In each setting, the receiver's behavior or preferences shift adversarially against the sender as the sender's strategy becomes less accurate. We analyze and solve these communication games in the presence of negative reciprocity, even when it generates endogenous preferences, and we characterize the novel ways in which classical results are altered. Our findings link information design to behavioral economics highlighting the implications of design-dependent preferences.

Keywords: Strategic communication; Negative reciprocity; Endogenous preferences (search for similar items in EconPapers)
JEL-codes: D83 D91 (search for similar items in EconPapers)
Date: 2026-04
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