Bayesian Persuasion

67 Pages Posted: 24 Nov 2009

See all articles by Emir Kamenica

Emir Kamenica

University of Chicago

Matthew Gentzkow

University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER)

Date Written: November 2009

Abstract

When is it possible for one person to persuade another to change her action? We take a mechanism design approach to this question. Taking preferences and initial beliefs as given, we introduce the notion of a persuasion mechanism: a game between Sender and Receiver defined by an information structure and a message technology. We derive necessary and sufficient conditions for the existence of a persuasion mechanism that strictly benefits Sender. We characterize the optimal mechanism. Finally, we analyze several examples that illustrate the applicability of our results.

Suggested Citation

Kamenica, Emir and Gentzkow, Matthew Aaron, Bayesian Persuasion (November 2009). NBER Working Paper No. w15540. Available at SSRN: https://ssrn.com/abstract=1510985

Emir Kamenica

University of Chicago ( email )

1101 East 58th Street
Chicago, IL 60637
United States

Matthew Aaron Gentzkow

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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