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This paper examines the effectiveness of cheap talk when the receiver is imperfectly informed. We show that the receiver’s prior knowledge becomes an impediment to efficient communication in a model with the discrete state space: in general, the more the receiver is informed, the less...
Persistent link: https://www.econbiz.de/10003921775
In this paper we analyze a cheap talk model with a partially informed receiver. In clear contrast to the previous literature, we find that there is a case where the receiver's prior knowledge enhances the amount of information conveyed via cheap talk. The point of departure is our explicit focus...
Persistent link: https://www.econbiz.de/10009516783
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Persistent link: https://www.econbiz.de/10012108416
This paper considers a model of strategic information transmission with an imperfectly informed receiver and provides a simple logic by which the receiver's prior knowledge becomes an impediment to efficient communication. We show that the extent of communication is severely limited as the...
Persistent link: https://www.econbiz.de/10014206893