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The (non-)robustness of influential cheap talk equilibria

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  • Christoph Diehl

    ()
    (Center for Mathematical Economics, Bielefeld University)

  • Christoph Kuzmics

    ()
    (Center for Mathematical Economics, Bielefeld University)

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    Abstract

    Chakraborty and Harbaugh (2010) prove the existence of influential cheap talk equilibria in one sender one receiver games when the state is multidimensional and the preferences of the sender are state-independent. We show that only the babbling equilibrium survives the introduction of any small degree of uncertainty about the sender’s preferences in the spirit of Harsanyi (1973). None of the influential equilibria are robust to this kind of uncertainty.

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    File URL: http://www.imw.uni-bielefeld.de/n/upload/paper/0266e33d3f546cb5436a10798e657d97.pdf
    File Function: First version, 2013
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    Bibliographic Info

    Paper provided by Bielefeld University, Center for Mathematical Economics in its series Working Papers with number 489.

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    Length: 15 pages
    Date of creation: Oct 2013
    Date of revision:
    Handle: RePEc:bie:wpaper:489

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    1. Archishman Chakraborty & Rick Harbaugh, 2006. "Persuasion by Cheap Talk," Working Papers 2006-10, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy, revised Oct 2009.
    2. Marco Battaglini, 2000. "Multiple Referrals and Multidimensional Cheap Talk," Econometric Society World Congress 2000 Contributed Papers 1557, Econometric Society.
    3. Dirk Bergemann & Stephen Morris, 2005. "Robust Mechanism Design," Econometrica, Econometric Society, vol. 73(6), pages 1771-1813, November.
    4. Morgan, John & Stocken, Phillip C, 2003. " An Analysis of Stock Recommendations," RAND Journal of Economics, The RAND Corporation, vol. 34(1), pages 183-203, Spring.
    5. Goltsman, Maria & Hörner, Johannes & Pavlov, Gregory & Squintani, Francesco, 2009. "Mediation, arbitration and negotiation," Journal of Economic Theory, Elsevier, vol. 144(4), pages 1397-1420, July.
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