Strategic information transmission with sender's approval: The single-crossing case

We consider games in which an informed sender first talks at no cost to a receiver; then, the latter proposes a decision and, finally, the sender accepts the proposal or “exits”. We make the following assumptions: the sender has finitely many types, the receiver's decision is real-valued, utili...

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Bibliographic Details
Published in:Games and economic behavior Vol. 134; pp. 242 - 263
Main Authors: Sémirat, Stéphan, Forges, Françoise
Format: Journal Article Paper
Language:English
Published: St. Louis Elsevier Inc 01.07.2022
Federal Reserve Bank of St. Louis
Elsevier
Subjects:
Discrete cheap talk
Economics and Finance
Humanities and Social Sciences
Participation constraints
Quantitative Finance
Single-crossing
Single-crossing
Discrete cheap talk
Participation constraints
C72
D82
Discrete Cheap talk
ISSN:0899-8256, 1090-2473
Online Access:Get full text
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Summary:We consider games in which an informed sender first talks at no cost to a receiver; then, the latter proposes a decision and, finally, the sender accepts the proposal or “exits”. We make the following assumptions: the sender has finitely many types, the receiver's decision is real-valued, utility functions over decisions are concave, single-peaked and single-crossing, exit is damaging to the receiver. In this setup, it may happen that babbling equilibria necessarily involve exit. We nevertheless propose a constructive algorithm that achieves a pure perfect Bayesian equilibrium without exit in every game of the class considered.
Bibliography:SourceType-Working Papers-1
ObjectType-Working Paper/Pre-Print-1
content type line 50
ISSN:0899-8256
1090-2473
DOI:10.1016/j.geb.2022.05.004