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Eliciting Private Information with Noise: The Case of Randomized Response

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  • Blume, Andreas

    (Center for Mathematical Economics, Bielefeld University)

  • Lai, Ernest K.

    (Center for Mathematical Economics, Bielefeld University)

  • Lim, Wooyoung

    (Center for Mathematical Economics, Bielefeld University)

Abstract

The paper formalizes Warner's (1965) randomized response technique (RRT) as a game and implements it experimentally, thus linking game theoretic approaches to randomness in communication with survey practice in the field and a novel implementation in the lab. As predicted by our model and in line with Warner, the frequency of truthful responses is significantly higher with randomization than without. The model predicts that randomization weakly improves information elicitation, as measured in terms of mutual information, although, surprisingly, not always by RRT inducing truth-telling. Contrary to this prediction, randomization significantly reduces the elicited information in our experiment.

Suggested Citation

  • Blume, Andreas & Lai, Ernest K. & Lim, Wooyoung, 2014. "Eliciting Private Information with Noise: The Case of Randomized Response," Center for Mathematical Economics Working Papers 490, Center for Mathematical Economics, Bielefeld University.
  • Handle: RePEc:bie:wpaper:490
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    File URL: https://pub.uni-bielefeld.de/download/2675241/2901859
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    Cited by:

    1. Pierpaolo Battigalli & Martin Dufwenberg, 2020. "Belief-Dependent Motivations and Psychological Game Theory," CESifo Working Paper Series 8285, CESifo.

    More about this item

    Keywords

    Laboratory Experiments; Mutual Information; Stigmatization Aversion; Randomized Response; Lying Aversion;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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