Cheap Talk with the Bayesian Truth Serum

77 Pages Posted: 23 May 2023

Date Written: May 16, 2023

Abstract

Biased responses in survey studies could seriously harm and mislead our economic decision-making. To mitigate survey response bias, we suggest an alternative way of combining two existing strategies, cheap talk and the Bayesian Truth Serum (BTS). In our three proof-of-concept experiments, we found that our alternative approach, named the C-BTS, helps elicit more truthful survey responses even in situations where neither the BTS nor cheap talk alone works well enough, especially in the context of economic valuation of goods. By applying the C-BTS, we have also confirmed that AI-powered services are already significantly enhancing the well-being of our citizens.

Keywords: cheap talk, Bayesian Truth Serum, hypothetical bias, willingness to pay, willingness to accept

JEL Classification: C83, C90, D90, D91, M31, O33

Suggested Citation

Lee, Jae Joon, Cheap Talk with the Bayesian Truth Serum (May 16, 2023). Available at SSRN: https://ssrn.com/abstract=4450528 or http://dx.doi.org/10.2139/ssrn.4450528

Jae Joon Lee (Contact Author)

Stanford University ( email )

Stanford, CA 94305
United States
9094070827 (Phone)
94306 (Fax)

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