Opinions as Incentives
AbstractWe study costs and benefits of differences of opinion between an adviser and a decision maker. Even when they share the same underlying preferences over decisions, a difference of opinion about payoff-relevant information leads to strategic information acquisition and transmission. A decision maker faces a fundamental trade-off: a greater difference of opinion increases an adviser's incentives to acquire information but exacerbates the strategic disclosure of any information that is acquired. Nevertheless, when choosing from a rich pool of opinion types, it is optimal for a decision maker to select an adviser with some difference of opinion. Centralization of authority is essential to harness these incentive gains since delegation to the adviser can discourage effort. (c) 2009 by The University of Chicago. All rights reserved..
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by University of Chicago Press in its journal Journal of Political Economy.
Volume (Year): 117 (2009)
Issue (Month): 5 (October)
Contact details of provider:
Web page: http://www.journals.uchicago.edu/JPE/
Other versions of this item:
- D8 - Microeconomics - - Information, Knowledge, and Uncertainty
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Hao Li & Wing Suen, 2004. "Delegating Decisions to Experts," Journal of Political Economy, University of Chicago Press, vol. 112(S1), pages S311-S335, February.
- Hao Li, 2001. "A Theory of Conservatism," Journal of Political Economy, University of Chicago Press, vol. 109(3), pages 617-636, June.
- repec:dgr:uvatin:2011055 is not listed on IDEAS
- Péter Eső & Ádám Galambos, 2013. "Disagreement and evidence production in strategic information transmission," International Journal of Game Theory, Springer, vol. 42(1), pages 263-282, February.
- Kohei Kawamura (University of Edinburgh), 2013. "Confidence and Competence in Communication," ESE Discussion Papers 222, Edinburgh School of Economics, University of Edinburgh.
- Rajiv Sethi & Muhamet Yildiz, 2009.
Economics Working Papers
0089, Institute for Advanced Study, School of Social Science.
- repec:eso:journl:v:42:y:2011:i:2:p:113-134 is not listed on IDEAS
- Shimizu, Takashi, 2013. "Cheap talk with an exit option: The case of discrete action space," Economics Letters, Elsevier, vol. 120(3), pages 397-400.
- Irene Valsecchi, 2013. "The expert problem: a survey," Economics of Governance, Springer, vol. 14(4), pages 303-331, November.
- Matthew Gentzkow & Jesse M. Shapiro & Michael Sinkinson, 2009. "The Effect of Newspaper Entry and Exit on Electoral Politics," NBER Working Papers 15544, National Bureau of Economic Research, Inc.
- Hertel, Johanna & Smith, John, 2010.
"Not so cheap talk: Costly and discrete communication,"
23560, University Library of Munich, Germany.
- Johanna Hertel & John Smith, 2013. "Not so cheap talk: costly and discrete communication," Theory and Decision, Springer, vol. 75(2), pages 267-291, August.
- Hertel, Johanna & Smith, John, 2011. "Not so cheap talk: Costly and discrete communication," MPRA Paper 29148, University Library of Munich, Germany.
- Ralph Boleslavsky & Tracy R. Lewis, 2011. "Advocacy and Dynamic Delegation," Working Papers 2011-7, University of Miami, Department of Economics.
- Jackson, Matthew O. & Tan, Xu, 2013. "Deliberation, disclosure of information, and voting," Journal of Economic Theory, Elsevier, vol. 148(1), pages 2-30.
- Di Maggio, Marco, 2009. "Sweet Talk: A Theory of Persuasion," MPRA Paper 18697, University Library of Munich, Germany.
- Raphael Boleslavsky & Christopher Cotton, 2011.
"Learning more by doing less,"
2012-1, University of Miami, Department of Economics.
- Adrian de Groot Ruiz & Theo Offerman & Sander Onderstal, 2011. "Power and the Privilege of Clarity: An Analysis of Bargaining Power and Information Transmission," Tinbergen Institute Discussion Papers 11-055/1, Tinbergen Institute, revised 31 Oct 2011.
- Eric J. Van den Steen, 2009.
"Authority versus Persuasion,"
Harvard Business School Working Papers
09-085, Harvard Business School.
- Jurjen J.A. Kamphorst & Otto H. Swank, 2010.
"When Galatea cares about her Reputation: How having Faith in your Workers reduces their Motivation to shine,"
Tinbergen Institute Discussion Papers
10-123/1, Tinbergen Institute.
- Kamphorst, Jurjen J.A. & Swank, Otto H., 2013. "When Galatea cares about her reputation: How having faith in your workers reduces their motivation to shine," European Economic Review, Elsevier, vol. 60(C), pages 91-104.
- Thomas J. Chemmanur & Viktar Fedaseyeu, 2012. "A Theory of Corporate Boards and Forced CEO Turnover," Working Papers 444, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
- Augustin Landier & David Sraer & David Thesmar, 2009. "Financial Risk Management: When Does Independence Fail?," American Economic Review, American Economic Association, vol. 99(2), pages 454-58, May.
- Fox, Justin & Van Weelden, Richard, 2010. "Partisanship and the effectiveness of oversight," Journal of Public Economics, Elsevier, vol. 94(9-10), pages 674-687, October.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Journals Division).
If references are entirely missing, you can add them using this form.