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Information-Revelation and Coordination Using Cheap Talk in a Battle of the Sexes with Two-Sided Private Information

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  • Chirantan Ganguly
  • Indrajit Ray

Abstract

We consider a Battle of the Sexes game with two types, High and Low, for each player and allow cheap talk regarding players' types before the game. We prove that the unique fully revealing symmetric cheap talk equilibrium exists for a low range of prior probability of the High-Type. This equilibrium has a desirable type-coordination property: it fully coordinates on the ex-post efficient pure Nash equilbrium when the players' types are different. Type-coordination is also obtained in a partially revealing equilibrium in which only the High-type is not truthful, for a medium range of prior probability of the High-type.

Suggested Citation

  • Chirantan Ganguly & Indrajit Ray, 2013. "Information-Revelation and Coordination Using Cheap Talk in a Battle of the Sexes with Two-Sided Private Information," Discussion Papers 13-01, Department of Economics, University of Birmingham.
  • Handle: RePEc:bir:birmec:13-01
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    References listed on IDEAS

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    1. Banks, Jeffrey S. & Calvert, Randall L., 1992. "A battle-of-the-sexes game with incomplete information," Games and Economic Behavior, Elsevier, vol. 4(3), pages 347-372, July.
    2. Russell Cooper & Douglas V. DeJong & Robert Forsythe & Thomas W. Ross, 1989. "Communication in the Battle of the Sexes Game: Some Experimental Results," RAND Journal of Economics, The RAND Corporation, vol. 20(4), pages 568-587, Winter.
    3. COOPER, R. & DEJONG, D.V. & FORSYTHE, R. & Tom Ross, 1989. "Communication In The Battle Of The Sexes Game," Carleton Industrial Organization Research Unit (CIORU) 89-03, Carleton University, Department of Economics.
    4. Cabrales, Antonio & Garcia-Fontes, Walter & Motta, Massimo, 2000. "Risk dominance selects the leader: An experimental analysis," International Journal of Industrial Organization, Elsevier, vol. 18(1), pages 137-162, January.
    5. In-Uck Park, 2002. "Cheap-Talk Coordination of Entry by Privately Informed Firms," RAND Journal of Economics, The RAND Corporation, vol. 33(3), pages 377-393, Autumn.
    6. Joseph Farrell, 1987. "Cheap Talk, Coordination, and Entry," RAND Journal of Economics, The RAND Corporation, vol. 18(1), pages 34-39, Spring.
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    Cited by:

    1. Ganguly, Chirantan & Ray, Indrajit, 2015. "Information-Revelation and Coordination Using Cheap Talk in a Game with Two-Sided Private Information," Cardiff Economics Working Papers E2015/7, Cardiff University, Cardiff Business School, Economics Section.

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    More about this item

    Keywords

    Battle of the Sexes; Private Information; Cheap Talk; Coordination; Full Revelation;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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