Expert advice for amateurs
A biased, perfectly informed expert advises a partially and privately informed decision maker using cheap-talk message. The decision maker can tell whether the state is “high” or “low” relative to a private threshold that divides the unit-interval state space into two subintervals. The decision maker's response to the expert's advice becomes less sensitive under the former's own information. In response, the expert provides advice that is considered more biased, relative to the case when decision maker is uninformed. For some types of decision maker, this negative, strategic effect of their own information outweighs its direct, positive effect—being informed makes them worse off. Examples show, however, that evaluated before the realization of her type, the opportunity to access information is always beneficial to the decision maker when the expert has moderate bias.
If 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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
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.:
- Farrell Joseph, 1993.
"Meaning and Credibility in Cheap-Talk Games,"
Games and Economic Behavior,
Elsevier, vol. 5(4), pages 514-531, October.
- J. Farrell, 2010. "Meaning and Credibility in Cheap Talk Games," Levine's Working Paper Archive 533, David K. Levine.
- Joseph Farrell., 1986. "Meaning and Credibility in Cheap-Talk Games," Economics Working Papers 8609, University of California at Berkeley.
- Farrell, Joseph, 1986. "Meaning and Credibility in Cheap-Talk Games," Department of Economics, Working Paper Series qt4968n3fz, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Ambrus, Attila & Takahashi, Satoru, 2008.
"Multi-sender cheap talk with restricted state spaces,"
Econometric Society, vol. 3(1), March.
- Takahashi, Satoru & Ambrus, Attila, 2008. "Multi-Sender Cheap Talk with Restricted State Spaces," Scholarly Articles 3200263, Harvard University Department of Economics.
- Jeanne Hagenbach & Frédéric Koessler, 2010.
"Strategic Communication Networks,"
Review of Economic Studies,
Oxford University Press, vol. 77(3), pages 1072-1099.
- Jeanne Hagenbach & Frédéric Koessler, 2008. "Strategic communication networks," PSE Working Papers halshs-00586847, HAL.
- Jeanne Hagenbach & Frédéric Koessler, 2009. "Strategic communication networks," Documents de travail du Centre d'Economie de la Sorbonne 09005, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
- Jeanne Hagenbach & Frédéric Koessler, 2009. "Strategic Communication Networks," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00367692, HAL.
- 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.
- Madrigal, Vicente & Tan, Tommy C. C. & Werlang, Sergio Ribeiro da Costa, 1987. "Support restrictions and sequential equilibria," Journal of Economic Theory, Elsevier, vol. 43(2), pages 329-334, December.
- Andreas Blume & Oliver Board & Kohei Kawamura, 2007.
ESE Discussion Papers
167, Edinburgh School of Economics, University of Edinburgh.
- 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.
- Krishna, Vijay & Morgan, John, 2004. "The art of conversation: eliciting information from experts through multi-stage communication," Journal of Economic Theory, Elsevier, vol. 117(2), pages 147-179, August.
- Marco Ottaviani & Francesco Squintani, 2006. "Naive audience and communication bias," International Journal of Game Theory, Springer, vol. 35(1), pages 129-150, December.
- Kartik, Navin & Ottaviani, Marco & Squintani, Francesco, 2007. "Credulity, lies, and costly talk," Journal of Economic Theory, Elsevier, vol. 134(1), pages 93-116, May.
- Andrew Caplin & John Leahy, 2004.
"The supply of information by a concerned expert,"
Royal Economic Society, vol. 114(497), pages 487-505, 07.
- Krishna, V. & Morgan, J., 1999.
"A Model of Expertise,"
206, Princeton, Woodrow Wilson School - Public and International Affairs.
- Marco Battaglini, 1999.
"Multiple Referrals and Multidimensional Cheap Talk,"
1295, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Marco Battaglini, 2002. "Multiple Referrals and Multidimensional Cheap Talk," Econometrica, Econometric Society, vol. 70(4), pages 1379-1401, July.
- Marco Battaglini, 2000. "Multiple Referrals and Multidimensional Cheap Talk," Econometric Society World Congress 2000 Contributed Papers 1557, Econometric Society.
- Junichiro Ishida, & Takashi Shimizu, 2012. "Can More Information Facilitate Communication?," ISER Discussion Paper 0839, Institute of Social and Economic Research, Osaka University.
- Olszewski, Wojciech, 2004. "Informal communication," Journal of Economic Theory, Elsevier, vol. 117(2), pages 180-200, August.
- Junichiro Ishida & Takashi Shimizu, 2009.
"Cheap Talk with an Informed Receiver,"
ISER Discussion Paper
0746r, Institute of Social and Economic Research, Osaka University, revised Jun 2015.
- Seidmann, Daniel J., 1990. "Effective cheap talk with conflicting interests," Journal of Economic Theory, Elsevier, vol. 50(2), pages 445-458, April.
- Watson, Joel, 1996. "Information Transmission When the Informed Party Is Confused," Games and Economic Behavior, Elsevier, vol. 12(1), pages 143-161, January.
- Crawford, Vincent P & Sobel, Joel, 1982.
"Strategic Information Transmission,"
Econometric Society, vol. 50(6), pages 1431-51, November.
- Navin Kartik, 2008.
"Strategic Communication with Lying Costs,"
2008 Meeting Papers
350, Society for Economic Dynamics.
- Chen, Ying, 2012. "Value of public information in sender–receiver games," Economics Letters, Elsevier, vol. 114(3), pages 343-345.
- Galeotti, Andrea & Ghiglino, Christian & Squintani, Francesco, 2013. "Strategic information transmission networks," Journal of Economic Theory, Elsevier, vol. 148(5), pages 1751-1769.
- Ivanov, Maxim, 2010. "Communication via a strategic mediator," Journal of Economic Theory, Elsevier, vol. 145(2), pages 869-884, March.
When requesting a correction, please mention this item's handle: RePEc:eee:jeborg:v:103:y:2014:i:c:p:1-16. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.