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Hierarchical cheap talk

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Author Info

  • Ambrus, Attila

    ()
    (Department of Economics, Harvard University)

  • Azevedo, Eduardo M.

    ()
    (Department of Economics, Harvard University)

  • Kamada, Yuichiro

    ()
    (Department of Economics, Harvard University)

Abstract

We investigate situations in which agents can communicate to each other only through a chain of intermediators, for example because they have to obey institutionalized communication protocols. We assume that all involved in the communication are strategic, and might want to influence the action taken by the final receiver. The set of pure strategy equilibrium outcomes is simple to characterize, monotonic in each intermediator's bias, does not depend on the order of intermediators, and intermediation in these equilibria cannot improve information transmission. However, none of these conclusions hold for mixed equilibria. We provide a partial characterization of mixed equilibria, and offer an economically relevant sufficient condition for every equilibrium to be outcome-equivalent to a pure equilibrium and hence the simple characterization and comparative statics results to hold for the set of all equilibria.

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Bibliographic Info

Article provided by Econometric Society in its journal Theoretical Economics.

Volume (Year): 8 (2013)
Issue (Month): 1 (January)
Pages:

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Handle: RePEc:the:publsh:1038

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Web page: http://econtheory.org

Related research

Keywords: Cheap talk; intermediation; communication protocols;

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References

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  1. Antonio Cabrales & Àlex Arenas & Albert Díaz-Guilera & Roger Guimerà & Fernando Vega-Redondo, 2004. "Optimal Information Transmission in Organizations: Search and Congestion," Working Papers 2004.77, Fondazione Eni Enrico Mattei.
  2. Ambrus, Attila & Takahashi, Satoru, 2008. "Multi-sender cheap talk with restricted state spaces," Theoretical Economics, Econometric Society, vol. 3(1), March.
  3. Visser, Bauke, 2000. "Organizational communication structure and performance," Journal of Economic Behavior & Organization, Elsevier, vol. 42(2), pages 231-252, June.
  4. Robert J. Aumann & Sergiu Hart, 2002. "Long Cheap Talk," Discussion Paper Series dp284, The Center for the Study of Rationality, Hebrew University, Jerusalem, revised Nov 2002.
  5. Ivanov, Maxim, 2010. "Communication via a strategic mediator," Journal of Economic Theory, Elsevier, vol. 145(2), pages 869-884, March.
  6. Ambrus, Attila & Azevedo, Eduardo M. & Kamada, Yuichiro & Takagi, Yuki, 2013. "Legislative committees as information intermediaries: A unified theory of committee selection and amendment rules," Journal of Economic Behavior & Organization, Elsevier, vol. 94(C), pages 103-115.
  7. Andrea Galeotti & Christian Ghiglino & Francesco Squintani, 2009. "Strategic Information Transmission in Networks," Economics Discussion Papers 668, University of Essex, Department of Economics.
  8. Ivanov, Maxim, 2010. "Informational control and organizational design," Journal of Economic Theory, Elsevier, vol. 145(2), pages 721-751, March.
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Citations

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Cited by:
  1. Daron Acemoglu & Kostas Bimpikis & Asuman E, Ozdaglar, 2010. "Dynamics of Information Exchange in Endogenous Social Networks," Levine's Working Paper Archive 661465000000000216, David K. Levine.
  2. Büchel, Berno & Hellmann, Tim & Klößner, Stefan, 2013. "Opinion Dynamics under Conformity," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79770, Verein für Socialpolitik / German Economic Association.
  3. Ambrus, Attila & Azevedo, Eduardo M. & Kamada, Yuichiro & Takagi, Yuki, 2013. "Legislative committees as information intermediaries: A unified theory of committee selection and amendment rules," Journal of Economic Behavior & Organization, Elsevier, vol. 94(C), pages 103-115.
  4. Pinghan Liang, 2010. "Transfer of Authority within Hierarchy," Levine's Working Paper Archive 661465000000000139, David K. Levine.
  5. Liang, Pinghan, 2013. "Optimal delegation via a strategic intermediary," Games and Economic Behavior, Elsevier, vol. 82(C), pages 15-30.
  6. Kolotilin, Anton & Li, Hao & Li, Wei, 2013. "Optimal limited authority for principal," Journal of Economic Theory, Elsevier, vol. 148(6), pages 2344-2382.

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