Efficient Communication in Organizations

Federico Vaccari

No 2022.39, Working Papers from Fondazione Eni Enrico Mattei

Abstract: Organizations design their communication structures to improve decision-making while limiting wasteful influence activities. An efficient communication protocol grants complete information payoffs to all organization members, thereby overcoming asymmetric information problems at no cost. This paper characterizes efficient protocols assuming that: (i) some agents within the organization have the knowledge required for optimal decision-making; (ii) both the organization and consulted agents incur losses proportional to the exerted influence activities; and (iii) informed agents can discuss their strategies before being consulted. Under these assumptions, “public advocacy” is the unique efficient communication protocol. This result provides a novel rationale for public advocacy.

Keywords: Information; Communication; Organizations; Efficiency; Costly Talk (search for similar items in EconPapers)
JEL-codes: D23 D82 D83 (search for similar items in EconPapers)
Date: 2022-12
New Economics Papers: this item is included in nep-gth and nep-mic
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Related works:
Working Paper: Efficient Communication in Organizations (2025)
Working Paper: Efficient Communication in Organizations (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:fem:femwpa:2022.39

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