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Persuasion with unknown beliefs

Author

Listed:
  • Kosterina, Svetlana

    (Department of Economics, University of Pittsburgh)

Abstract

A sender designs an information structure to persuade a receiver to take an action. The sender is ignorant about the receiver's prior, and evaluates each information structure using the receiver's prior that is the worst for the sender. I characterize the optimal information structures in this environment. I show that there exists an optimal signal with two realizations, characterize the support of the signal realization recommending approval and show that the optimal signal is a hyperbola. The lack of knowledge of the receiver's prior causes the sender to hedge her bets: the optimal signal induces the high action in more states than in the standard model, albeit with a lower probability. Increasing the sender's ignorance can hurt both the sender and the receiver.

Suggested Citation

  • Kosterina, Svetlana, 2022. "Persuasion with unknown beliefs," Theoretical Economics, Econometric Society, vol. 17(3), July.
    • Handle: RePEc:the:publsh:4742
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    Citations

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    Cited by:

    1. Alexei Parakhonyak & Anton Sobolev, 2022. "Persuasion without Priors," Economics Series Working Papers 977, University of Oxford, Department of Economics.
    2. Krishnamurthy Iyer & Haifeng Xu & You Zu, 2023. "Markov Persuasion Processes with Endogenous Agent Beliefs," Papers 2307.03181, arXiv.org, revised Jul 2023.
    3. Shiri Alon & Sarah Auster & Gabi Gayer & Stefania Minardi, 2023. "Persuasion With Limited Data: A Case-Based Approach," CRC TR 224 Discussion Paper Series crctr224_2023_443, University of Bonn and University of Mannheim, Germany.
    4. Yiling Chen & Tao Lin, 2023. "Persuading a Behavioral Agent: Approximately Best Responding and Learning," Papers 2302.03719, arXiv.org, revised Feb 2024.
    5. Babichenko, Yakov & Talgam-Cohen, Inbal & Xu, Haifeng & Zabarnyi, Konstantin, 2022. "Regret-minimizing Bayesian persuasion," Games and Economic Behavior, Elsevier, vol. 136(C), pages 226-248.
    6. Maxim Senkov & Toygar T. Kerman, 2024. "Changing Simplistic Worldviews," Papers 2401.02867, arXiv.org.
    7. Tommaso Denti & Doron Ravid, 2023. "Robust Predictions in Games with Rational Inattention," Papers 2306.09964, arXiv.org.

    More about this item

    Keywords

    Bayesian persuasion; robust mechanism design;

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty

    Statistics

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