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