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Coarse Information Design

Author

Listed:
  • Qianjun Lyu

    (University of Bonn)

  • Wing Suen

    (University of Hong Kong)

  • Yimeng Zhang

    (University of Hong Kong)

Abstract

We study an information design problem with continuous state and discrete signal space. Under convex value functions, the optimal information structure is interval-partitional and exhibits a dual expectations property: each induced signal is the conditional mean (taken under the prior density) of each interval; and each interval cutoff is the conditional mean (taken under the value function curvature) of the interval formed by neighboring signals. This property enables an examination into which part of the state space is more finely partitioned. The analysis can be extended to general value functions and adapted to study coarse mechanism design.

Suggested Citation

  • Qianjun Lyu & Wing Suen & Yimeng Zhang, 2024. "Coarse Information Design," ECONtribute Discussion Papers Series 314, University of Bonn and University of Cologne, Germany.
    • Handle: RePEc:ajk:ajkdps:314
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    References listed on IDEAS

    as
    1. Yifan Xia & Ling Zhang & Iris L. Li, 2021. "Multidimensional Economic Dispersion Index and Application," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 39(3), pages 729-740, July.
    2. Andreas Kleiner & Benny Moldovanu & Philipp Strack, 2021. "Extreme Points and Majorization: Economic Applications," Econometrica, Econometric Society, vol. 89(4), pages 1557-1593, July.
    3. Alfred Galichon, 2016. "Optimal Transport Methods in Economics," Economics Books, Princeton University Press, edition 1, number 10870.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Dual expectations; scrutiny; Coarse mechanism design;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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