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Cheap Talk Games

In: Strategy and Game Theory

Author

Listed:
  • Felix Munoz-Garcia

    (Washington State University)

  • Daniel Toro-Gonzalez

    (Universidad Tecnológica de Bolívar)

Abstract

This chapter analyzes a special class of signaling games where the sender faces costless messages. We examine whether separating PBEs can be sustained, where information is conveyed from the privately informed sender to the uninformed receiver; and whether pooling PBEs can be supported, where the sender conceals his private information from the receiver. We show that information transmission can occur (that is, a separating PBE can be sustained) if the preferences of sender and receiver are sufficiently aligned; otherwise no information transmission exists between the parties.

Suggested Citation

  • Felix Munoz-Garcia & Daniel Toro-Gonzalez, 2019. "Cheap Talk Games," Springer Texts in Business and Economics, in: Strategy and Game Theory, edition 2, chapter 0, pages 459-485, Springer.
    • Handle: RePEc:spr:sptchp:978-3-030-11902-7_10
    DOI: 10.1007/978-3-030-11902-7_10
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