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Receiver’s dilemma

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  • Jung, Hanjoon Michael

Abstract

In a sender–receiver game, the sender’s concern for his credibility as a source of truthful information will boost his incentive to report truthfully. However, because his preferences over the outcomes differ from the receivers’, he still has an incentive to manipulate information in his favor. While the receivers comprehend this incentive, we nevertheless show that they do not ignore his message and play according to his preferences, which leads to his (not their) favorite outcome. This is the dilemma that the receivers are faced with. We identify a generic game that shows this receiver’s dilemma.

Suggested Citation

  • Jung, Hanjoon Michael, 2018. "Receiver’s dilemma," Journal of Mathematical Economics, Elsevier, vol. 75(C), pages 116-124.
    • Handle: RePEc:eee:mateco:v:75:y:2018:i:c:p:116-124
    DOI: 10.1016/j.jmateco.2018.01.005
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