We analyze the performance of various communication protocols in a generalization of the Crawford-Sobel (1982) model of cheap talk that allows for multiple receivers. We find that whenever the sender can communicate informatively with both receivers by sending private messages, she can...

We solve for the optimal mechanism for selling two goods when the buyer's demand characteristics are unobservable. In the case of substitutable goods, the seller has an incentive to offer lotteries over goods in order to charge the buyers with large differences in the valuations a higher price...

We study communication in a static Cournot duopoly model under the assumption that the firms have unverifiable private information about their costs. We show that cheap talk between the firms cannot transmit any information. However, if the firms can communicate through a third party,...

We extend the 'no-haggling' result of Riley and Zeckhauser (1983) to the class of linear multiproduct monopoly problems when the buyer's valuations are smoothly distributed. In particular we show that there is no loss for the seller in optimizing over mechanisms such that all allocations belong...

We study cheap-talk pre-play communication in the static all-pay auctions. For the case of two bidders, all correlated and communication equilibria are payoff equivalent to the Nash equilibrium if there is no reserve price, or if it is commonly known that one bidder has a strictly higher value....

We study a problem of optimal auction design in the realistic case in which the players can collude both on the way they play in the auction and on their participation decisions. Despite the fact that the principal's opportunities for extracting payments from the agents in such a situation are...

We compare three common dispute resolution processes - negotiation, mediation, and arbitration - in the framework of Crawford and Sobel (1982). Under negotiation, the two parties engage in (possibly arbitrarily long) face-to-face cheap talk. Under mediation, the parties communicate with a...

We study how different demographic groups respond to incentives by comparing their performance in “high” and “low” stakes situations. The high stakes situation is the GRE examination and the low stakes situation is a voluntary experimental section of the GRE. We find that Males exhibit a...

This paper studies how different demographic groups respond to incentives by comparing performance in the GRE examination in high and low stakes situations. The high stakes situation is the real GRE examination and the low stakes situation is a voluntary experimental section of the GRE that...

One of the approaches in consumer theory considers each product as a collection of attributes. As opposed to the traditional approach, according to which consumer preferences for products are the underlying features of economic modeling, they are now derived from the composition and strength of...