22 Pages Posted: 18 Sep 2017 Last revised: 28 Dec 2020
Date Written: September 15, 2017
In the context of Bayesian Persuasion (Kamenica and Gentzkow, 2011), typically, a biased Sender designs a signal to influence the binary decision of an unbiased Receiver. Can the Receiver improve her payoffs by adopting a resistance strategy, i.e., by committing into incurring (deterministic or stochastic) costs if she picks the Sender-preferred action? We argue that deterministic resistance strategies cannot improve the Receiver's payoffs, whereas stochastic resistance strategies can increase both the informativeness of the signal and the Receiver's payoffs. We fully characterize the optimal resistance strategy and show that it always induces a substantial increase in the Receiver's welfare, as well as a perfectly informative signal.
Keywords: Bayesian Persuasion, Resistance, Uncertainty, Public Commitment
JEL Classification: D72, D82, D83, K40, M38
Suggested Citation: Suggested Citation