Competition in costly talk

DOI10.1016/J.JET.2023.105740MaRDI QIDQ6090464zbMATH OpenOpenAlexFDO

Authors Federico Vaccari

Publication date 17 November 2023

Published in Journal of Economic Theory (Search for Journal in Brave)

Copyright license Creative Commons Attribution 4.0 International

Full work available at URL https://arxiv.org/abs/2103.05317

zbMATH Keywords

communicationcompetitioncostly talklyingmultiple senderssignaling

Mathematics Subject Classification ID

Signaling and communication in game theory (91A28)

Abstract: This paper studies a communication game between an uninformed decision maker and two perfectly informed senders with conflicting interests. Senders can misreport information at a cost that increases with the size of the misrepresentation. The main results show that equilibria where the decision maker obtains the complete-information payoff hinge on beliefs with undesirable properties. The imposition of a minimal and sensible belief structure is sufficient to generate a robust and essentially unique equilibrium with partial information transmission. A complete characterization of this equilibrium unveils the language senders use to communicate.

Review text

The model proposed and studied in this article describes strategic communication between two senders and one receiver. The receiver selects between two alternatives according to the reports from the senders. The senders have an incentive to misreport the actual situation when it is against their interest, though this incurs some cost: further from the exact situation, higher the cost. The analysis of the existence and properties of perfect Bayesian equilibria in the model involves several additional assumptions, which are justified throughout the article. A starting observation is that the so-called babbling equilibria (characteristic for cheap talk) do not appear in the model. Furthermore, receiver-efficient equilibria (in particular, fully revealing equilibria, characteristic for signaling games) cannot appear if the beliefs of the decision-making receiver are unprejudiced. To remedy extra biased beliefs, the author introduces the notion of adversarial equilibrium (AE). Such an equilibrium always exists, is unique in terms of outcomes, and is either robust or equivalent to another AE that is additionally robust. Also, there exist AEs with unprejudiced beliefs. The notion of AE relies on the proper understanding of swing reports, that is, reports with the intent to persuade the receiver to make a decision in favor of the sender's interest that goes against the actual situation being reported. Some extensions of the model to incorporate uncertainty of beliefs and allow senders to withdraw information are addressed at the end of the article.

Recommendations

• Competition in persuasion
• Competitive cheap talk
• Competition in persuasion: an experiment
• Bayesian persuasion with costly messages
• Persuasion with communication costs

Cites work

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• Success in contests
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Cited in

(2)

• Discussion: Making Progress in a Crowded Market
• Toxic types and infectious communication breakdown

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