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Peddling Influence through Intermediaries

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  • Wei Li
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    Abstract

    A sender may communicate with a decision maker through intermediaries. In this model, an objective sender and intermediary pass on information truthfully, while biased ones favor a particular agenda but also have reputational concerns. I show that the biased sender and the biased intermediary's reporting truthfulness are strategic complements. The biased sender is less likely to use an intermediary than an objective sender if his reputational concerns are low, but more likely to do so if his reputational concerns are moderate. Moreover, the biased sender may be more likely to use an intermediary perceived to be more biased. (JEL D82, D83)

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    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/aer.100.3.1136
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    Bibliographic Info

    Article provided by American Economic Association in its journal American Economic Review.

    Volume (Year): 100 (2010)
    Issue (Month): 3 (June)
    Pages: 1136-62

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    Handle: RePEc:aea:aecrev:v:100:y:2010:i:3:p:1136-62

    Note: DOI: 10.1257/aer.100.3.1136
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    References

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    1. LI, Ming & MYLOVANOV, Tymofiy, 2010. "Credibility for Sale - The Effect of Disclosure on Information Acquisition and Transmission," Cahiers de recherche 08-2010, Centre interuniversitaire de recherche en ├ęconomie quantitative, CIREQ.
    2. Prendergast, Canice & Stole, Lars, 1996. "Impetuous Youngsters and Jaded Old-Timers: Acquiring a Reputation for Learning," Journal of Political Economy, University of Chicago Press, vol. 104(6), pages 1105-34, December.
    3. Malueg, David A. & Tsutsui, Shunichi O., 1996. "Duopoly information exchange: The case of unknown slope," International Journal of Industrial Organization, Elsevier, vol. 14(1), pages 119-136.
    4. Kohei Kawamura, 2006. "Anonymity, Equal Treatment, and Overconfidence: Constraints on Communication May Enhance Information Transmission," Economics Series Working Papers 268, University of Oxford, Department of Economics.
    5. Wei Li, 2007. "Changing One's Mind when the Facts Change: Incentives of Experts and the Design of Reporting Protocols," Review of Economic Studies, Oxford University Press, vol. 74(4), pages 1175-1194.
    6. Ivanov, Maxim, 2010. "Communication via a strategic mediator," Journal of Economic Theory, Elsevier, vol. 145(2), pages 869-884, March.
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    Cited by:
    1. Kolotilin, Anton & Li, Hao & Li, Wei, 2013. "Optimal limited authority for principal," Journal of Economic Theory, Elsevier, vol. 148(6), pages 2344-2382.
    2. Sidartha Gordon & Ying Chen, 2014. "Information Transmission in Nested Sender-Receiver Games," Sciences Po Economics Discussion Papers 2014-04, Sciences Po Departement of Economics.

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