Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/223574
Authors: 
Lang, Matthias
Year of Publication: 
2020
Series/Report no.: 
CESifo Working Paper 8502
Abstract: 
Individuals use narratives as rationales or justifications to make their claims more convincing. I provide a general framework for partial verifiability based on narratives. Narratives give many reasons and arguments. The receiver derives the message’s meaning by aggregating these reasons; her private information tells her whether some potential reasons support the sender’s claims. Therefore, the receiver detects misreports with positive probability. Narratives flexibly allow for different degrees of partial verifiability and allow using the revelation principle. Considering mechanism design as an example, I prove that narratives are so powerful to implement efficient trade in the canonical bilateral-trade setting.
Subjects: 
narrative
communication
partial verifiability
mechanism design
bilateral trade
JEL: 
D81
D82
D86
Document Type: 
Working Paper

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