Ordinal Cheap Talk Kelley School of Business序号廉价交谈凯利商学院.pptVIP

Comparative Cheap Talk Archishman Chakraborty and Rick Harbaugh JET, forthcoming Cheap talk about private information Seller knows something about quality of a product Professor knows something about prospects of a student Analyst knows something about value of a stock Auditor knows something about viability of a company Ebay knows something about quality of sellers Interval cheap talk(Crawford and Sobel, 1982) Biased Sender S knows realization of r.v. θ distributed uniformly on [0,1] Receiver R takes action a US = -(a-(θ+b))2 UR = -(a-θ)2 Informed R chooses a = θ But S ideal is a = θ+b For any realization θ that S reports, R will believe true θ is lower So S must exaggerate even more and R compensates even more So communication breaks down and R just chooses a=E[θ] S receives expected payoff of only E[US] = -Var[θ]-b2 Which is less than if S told truth! E[US] = -b2 But some communication is still possible for small b Consider b=1/10 S states θ in [0,3/10] or θ in (3/10,1] S ideal action for θ=3/10 is a=4/10 E[θ| θ in [0,3/10]]= 3/20 E[θ| θ in (3/10,1]]=13/20 So S is indifferent at θ=3/10 and prefers truth on either side Smaller b, more partitions b1/4 no communication b1/4 two partitions max b1/12 three partitions max etc. If interests are too far apart such cheap talk does not work Uncertainty over quality of a good - seller tells buyer it’s great Uncertainty over prospects for a stock – analyst says it’s a sure bet Uncertainty over whether a spending program is worthwhile – administrator says it’s essential Uncertainty over quality of a job applicant – recommender says he’s great Cheap talk is not credible if there is some action the sender always wants the receiver to take (e.g. the maximal action) What if there is uncertainty along multiple dimensions? Seller has multiple goods – they’re all great! Analyst recommends multiple stocks – buy them all! Lobbyist favors multiple spending programs – they’re all necessary! Professor has