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Persuasive communication when the sender's incentives are uncertain

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  • Jindapon, Paan
  • Oyarzun, Carlos

Abstract

We study persuasion in a modified Crawford–Sobel sender–receiver game in which the receiver makes a binary decision to accept or reject a good recommended by the sender. The good's quality and the sender's type (neutral or biased) are not observable to the receiver. These alterations yield a simple model and a unique truth-telling equilibrium in which neutral senders who observe different qualities fully separate but can only communicate low quality levels accurately. Biased senders adopt a mixed strategy that can successfully persuade the receiver to accept the good most of the time. When the sender's degree of bias is continuously distributed, a truth-telling equilibrium does not exist. Nonetheless, a partition equilibrium exists for any given number of partitions on the message space.

Suggested Citation

  • Jindapon, Paan & Oyarzun, Carlos, 2013. "Persuasive communication when the sender's incentives are uncertain," Journal of Economic Behavior & Organization, Elsevier, vol. 95(C), pages 111-125.
  • Handle: RePEc:eee:jeborg:v:95:y:2013:i:c:p:111-125
    DOI: 10.1016/j.jebo.2013.08.015
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    1. Boris Knapp, 2021. "Fake Reviews and Naive Consumers," Vienna Economics Papers 2102, University of Vienna, Department of Economics.
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    More about this item

    Keywords

    Strategic communication; Persuasion; Perfect Bayesian equilibrium;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality

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