Dynamic Strategic Information Transmission

42 Pages Posted: 4 Aug 2012 Last revised: 3 Oct 2013

See all articles by Andrea Wilson

Andrea Wilson

New York University (NYU) - Department of Economics

Mikhail Golosov

Princeton University - Department of Economics

Vasiliki Skreta

University of Texas at Austin - Department of Economics; University College London

Aleh Tsyvinski

Yale University; Yale University - Cowles Foundation

Multiple version iconThere are 3 versions of this paper

Date Written: September 15, 2013

Abstract

This paper studies strategic information transmission in a finite-horizon environment where, each period, a privately informed expert sends a message and a decision-maker takes an action. Our main contribution is to show that communication in this dynamic environment is drastically different from in a one-shot game. First, full information revelation is possible; we provide a constructive method to build such fully revealing equilibria. Second, we show that complicated communication, where far-away types pool together, allows for dynamic manipulation of beliefs to enable better information release in the future. Finally, we show that conditioning future messages on past actions improves incentives for information revelation.

Keywords: asymmetric information, cheap talk, dynamic strategic communication, full information revelation

JEL Classification: C72, D82

Suggested Citation

Wilson, Andrea and Golosov, Mikhail and Skreta, Vasiliki and Tsyvinski, Aleh and Tsyvinski, Aleh, Dynamic Strategic Information Transmission (September 15, 2013). NYU Law and Economics Research Paper, Available at SSRN: https://ssrn.com/abstract=2123710 or http://dx.doi.org/10.2139/ssrn.2123710

Andrea Wilson (Contact Author)

New York University (NYU) - Department of Economics ( email )

269 Mercer Street, 7th Floor
New York, NY 10011
United States

Mikhail Golosov

Princeton University - Department of Economics ( email )

111 Fisher Hall
Princeton, NJ 08544-1021
United States

Vasiliki Skreta

University of Texas at Austin - Department of Economics ( email )

Austin, TX 78712
United States

HOME PAGE: http://vskreta.wixsite.com/vskreta

University College London ( email )

Gower Street
London, WC1E 6BT
United Kingdom

HOME PAGE: http://vskreta.wixsite.com/vskreta

Aleh Tsyvinski

Yale University - Cowles Foundation ( email )

28 Hillhouse Ave
New Haven, CT 06520-8268
United States
203-432-9163 (Phone)

Yale University ( email )

New Haven, CT 06520
United States

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