17 Pages Posted: 12 Oct 2016 Last revised: 16 Oct 2016
Date Written: August 30, 2016
Two agents have to collectively select one of two options. They are endowed with a personal bias, each in favor of a different option, and they observe a private signal with known quality. They then need to reveal their private signal to the other agent, but may decide to withhold some of the evidence the private signal provides, in order to persuade the other agent in the direction of their own bias. We present a Bayesian model capturing this form of persuasion. The model applies to a variety of phenomena, including political discussions, settlement negotiations and trade.
Keywords: persuasion, opinion formation, information manipulation, litigation, settlement, trade
JEL Classification: K41, D03, D83
Suggested Citation: Suggested Citation