Organized Information Transmission

Abstract

We formalize the concepts of horizontal and vertical information transmission and introduce two families of information structures, namely single-meeting schemes and delegated hierarchies, that specialize along these dimensions. We characterize the strategic outcomes that they implement in general finite incomplete information games and illustrate the resulting linear programming approach in a linear network example. We build on the characterizations to show that these families are unconstrained-optimal in binary-action games with strategic complementarities. Finally, we generalize these families to multiple meetings and random hierarchies and characterize the corresponding strategic outcomes.

Keywords: Bayes correlated equilibrium, delegated transmission, incomplete information, information design

JEL Classification: C72, D82, D83