To Disclose or Not to Disclose: Cheap Talk with Uncertain Biases
I study strategic information transmission when biases are uncertain. A perfectly informed expert advises a decision maker. The expert has biases with direction unknown to the decision maker. I show that all equilibria are of partitional form as identified by Crawford and Sobel (1982). It never benefits the decision maker or the expert to have the bias of the expert disclosed. The decision maker is better off when the bias distribution is more balanced or when the bias size is smaller.
|Date of creation:||Aug 2003|
|Date of revision:||Aug 2004|
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