Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/221601
Authors: 
Austen-Smith, David
Banks, Jeffrey S.
Year of Publication: 
1998
Series/Report no.: 
Discussion Paper No. 1245
Abstract: 
We augment the standard Crawford-Sobel (Econometrica 1982) model of cheap talk communication by allowing the informed party to use both costless and costly messages. The issues on which we focus are the consequences for cheap talk signaling of the option to use a costly signal ("burned money"); the circumstances under which both cheap talk and burned money are used to signal information; and the extent to which burning money is the preferred instrument for information transmission.
Document Type: 
Working Paper

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