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Multidimensional Cheap Talk and Delegation

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  • Jaehoon Kim
  • Lawrence S. Rothenberg

Abstract

We analyse a cheap-talk game where contrasting lobbies are asymmetrically informed. Equilibrium information transmission depends on each lobby´s preference alignment with the legislator on the dimension of its expertise, and on the conflict of lobby interests. Full revelation is possible only when each lobby´s preference on its expertise is completely aligned with the legislator´s. Otherwise, greater preference alignment and lowered lobbyist conflict induce more transmission. We also show that results are sensitive to the legislator´s expertise. In turn, we demonstrate how informational impacts provide predictions about when legislators will delegate to an expert, and we note our analyses´ broader empirical implications.

Suggested Citation

  • Jaehoon Kim & Lawrence S. Rothenberg, 2015. "Multidimensional Cheap Talk and Delegation," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 171(2), pages 263-284, June.
    • Handle: RePEc:mhr:jinste:urn:sici:0932-4569(201506)171:2_263:mctad_2.0.tx_2-0
    DOI: 10.1628/093245613X14273596658883
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    References listed on IDEAS

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    1. Marco Battaglini, 2002. "Multiple Referrals and Multidimensional Cheap Talk," Econometrica, Econometric Society, vol. 70(4), pages 1379-1401, July.
    2. , & ,, 2008. "Multi-sender cheap talk with restricted state spaces," Theoretical Economics, Econometric Society, vol. 3(1), March.
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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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