Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/149026
Authors: 
Schopohl, Simon
Year of Publication: 
2016
Series/Report no.: 
Working Papers, Center for Mathematical Economics 569
Abstract: 
We consider a Sender-Receiver game in which the Sender can choose between sending a cheap-talk message, which is costless, but also not verified and a costly verified message. While the Sender knows the true state of the world, the Receiver does not have this information, but has to choose an action depending on the message he receives. The action then yields to some utility for Sender and Receiver. We only make a few assumptions about the utility functions of both players, so situations may arise where the Sender's preferences are such that she sends a message trying to convince the Receiver about a certain state of the world, which is not the true one. In a finite setting we state conditions for full revelation, i.e. when the Receiver always learns the truth. Furthermore we describe the player's behavior if only partial revelation is possible. For a continuous setting we show that additional conditions have to hold and that these do not hold for "smooth" preferences and utility, e.g. in the classic example of quadratic loss utilities.
Subjects: 
cheap-talk
communication
costly disclosure
full revelation
increasing differences
Sender-Receiver game
verifiable information
JEL: 
C72
D82
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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