Coordination-Free Equilibria in Cheap Talk Games

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Peer reviewed: 
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Faculty/Staff
Final version published as: 

Lu, S. 2017. Coordination-free equilibria in cheap talk games. J. Econ. Theory 168, 177-208. https://doi.org/10.1016/j.jet.2016.12.004

Date created: 
2017-03
Keywords: 
Cheap talk
Strategic communication
Robustness
Incomplete information
Abstract: 

This paper characterizes generic equilibrium play in a multi-sender version of Crawford and Sobel's (1982) cheap talk model, when robustness to a broad class of beliefs about noise in the senders' observation of the state is required. Just like in the one-sender model, information transmission is partial, equilibria have an interval form, and they can be computed through a generalized version of Crawford and Sobel’s forward solution procedure. Fixing the senders' biases, full revelation is not achievable even as the state space becomes large. Intuitive welfare predictions, such as the desirability of consulting senders with small and opposite biases, follow.

Language: 
English
Document type: 
Article
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