Abstract
Chakraborty and Harbaugh (Am Econ Rev 100(5):2361–2382, 2010) prove the existence of influential cheap talk equilibria in one sender one receiver games when the state is multidimensional and the preferences of the sender are state independent. We show that influential equilibria do not survive the introduction of any small degree of Harsanyi-uncertainty, i.e., uncertainty about the sender’s preferences in the spirit of Harsanyi (Int J Game Theory 2(1):1–23, 1973).
Highlights
This paper is concerned with the strategic information transmission between one informed sender and one uninformedAn earlier draft of the paper was circulated under the title “Therobustness of influential cheap talk equilibria”
In this paper we assume that the receiver, while possibly having a good general idea about the sender’s preferences, does not believe that any particular utility function has positive probability. We call this the Chakraborty and Harbaugh (2010) model with Harsanyi-uncertainty, as the uncertainty is very much as it is in the purification argument of Harsanyi (1973). Completing this model by assuming that the receiver’s subjective belief about the sender’s utility function is common knowledge, we find that this modified game has no influential equilibria
We study sender-receiver games with a single sender and a single receiver
Summary
This paper is concerned with the strategic information transmission (as first analyzed in Crawford and Sobel 1982) between one informed sender and one uninformed. One of the main findings of the cheap talk literature, started by Crawford and Sobel (1982), is that influential communication in one sender one receiver games is typically only possible if the conflict of interest is not too large.. Chakraborty and Harbaugh (2010) relax these informational assumptions in a robustness exercise in two different ways, and show, for each case, that the game so modified still exhibits influential equilibria Both robustness exercises allow the sender to have possibly different utility functions. We call this the Chakraborty and Harbaugh (2010) model with Harsanyi-uncertainty, as the uncertainty is very much as it is in the purification argument of Harsanyi (1973) Completing this model by assuming that the receiver’s subjective belief about the sender’s utility function is common knowledge, we find that this modified game has no influential equilibria.
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