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Skewed Information Transmission

Author

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  • Francesc Dilmé

Abstract

This paper analyzes strategic information transition between skewed agents. More concretely, we study the Crawford and Sobel (1982) setting in the case where agents are not biased, but they differ on the relative importance they put on avoiding "upward" or "downward" mistakes. We show that, even though the agents could fully communicate when the state of the world was perfectly observed by the sender, the information transmission is significantly imprecise in any equilibrium when there is a small noise in the observation. Hence, contrary to what was previous thought, a low objective misalignment is not sufficient for precise equilibrium communication.

Suggested Citation

  • Francesc Dilmé, 2018. "Skewed Information Transmission," CRC TR 224 Discussion Paper Series crctr224_2018_033, University of Bonn and University of Mannheim, Germany.
    • Handle: RePEc:bon:boncrc:crctr224_2018_033
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    File URL: https://www.crctr224.de/research/discussion-papers/archive/dp033
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    More about this item

    Keywords

    Strategic Communication; Skewed Preferences;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • 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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