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Communication between unbiased agents

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  • Dilmé, Francesc

Abstract

We examine a version of the model of Crawford and Sobel (1982) in which agents are not biased, but their preferences are not necessarily smooth. In this situation, we show that communication converges to full information transmission as the number of messages used for communication increases if and only if the sender and the receiver have the same local relative preferences for avoiding small “upward” or “downward” mistakes. When these conditions fail, either an arbitrarily small bias or an arbitrarily small noise in the observation of the state may make communication very coarse in all equilibria, even when the message space is infinite. Hence, contrary to what was previously thought, continuity of preferences and close alignment between the sender's and receiver's ideal actions do not guarantee the existence of equilibria with precise information transmission.

Suggested Citation

  • Dilmé, Francesc, 2023. "Communication between unbiased agents," Games and Economic Behavior, Elsevier, vol. 142(C), pages 613-622.
    • Handle: RePEc:eee:gamebe:v:142:y:2023:i:c:p:613-622
    DOI: 10.1016/j.geb.2023.09.008
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    References listed on IDEAS

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    1. Murali Agastya & Parimal Kanti Bag & Indranil Chakraborty, 2015. "Proximate preferences and almost full revelation in the Crawford–Sobel game," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 3(2), pages 201-212, October.
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    More about this item

    Keywords

    Strategic communication; Unbiased agents; Skewed preferences;
    All these keywords.

    JEL classification:

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