IDEAS home Printed from https://ideas.repec.org/a/oup/restud/v76y2009i4p1359-1395.html
   My bibliography  Save this article

Strategic Communication with Lying Costs

Author

Listed:
  • Navin Kartik

Abstract

I study a model of strategic communication between an uninformed Receiver and an informed but upwardly biased Sender. The Sender bears a cost of lying, or more broadly, of misrepresenting his private information. The main results show that inflated language naturally arises in this environment, where the Sender (almost) always claims to be of a higher type than he would with complete information. Regardless of the intensity of lying cost, there is incomplete separation, with some pooling on the highest messages. The degree of language inflation and how much information is revealed depend upon the intensity of lying cost. The analysis delivers a framework to span a class of cheap-talk and verifiable disclosure games, unifying the polar predictions they make under large conflicts of interest. I use the model to discuss how the degree of manipulability of information can affect the trade-off between delegation and communication. Copyright 2009, Wiley-Blackwell.

Suggested Citation

  • Navin Kartik, 2009. "Strategic Communication with Lying Costs," Review of Economic Studies, Oxford University Press, vol. 76(4), pages 1359-1395.
  • Handle: RePEc:oup:restud:v:76:y:2009:i:4:p:1359-1395
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1111/j.1467-937X.2009.00559.x
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Lacker, Jeffrey M & Weinberg, John A, 1989. "Optimal Contracts under Costly State Falsification," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1345-1363, December.
    2. Grossman, Sanford J, 1981. "The Informational Role of Warranties and Private Disclosure about Product Quality," Journal of Law and Economics, University of Chicago Press, vol. 24(3), pages 461-483, December.
    3. Eso, Peter & Schummer, James, 2004. "Bribing and signaling in second price auctions," Games and Economic Behavior, Elsevier, vol. 47(2), pages 299-324, May.
    4. Santiago Sánchez-Pagés & Marc Vorsatz, 2009. "Enjoy the silence: an experiment on truth-telling," Experimental Economics, Springer;Economic Science Association, vol. 12(2), pages 220-241, June.
    5. Manelli, Alejandro M, 1996. "Cheap Talk and Sequential Equilibria in Signaling Games," Econometrica, Econometric Society, vol. 64(4), pages 917-942, July.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:restud:v:76:y:2009:i:4:p:1359-1395. 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: (Oxford University Press) or (Christopher F. Baum). General contact details of provider: .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.