Clearly biased experts
Archishman Chakraborty*, Rick Harbaugh
Date: 2009-05-16 3:30 pm – 4:00 pm
Last modified: 2009-04-17
Abstract
We consider the credibility, informativeness, and value of multidimensional cheap talk by an expert with transparent motives. Transparency ensures that the expert can credibly communicate information across dimensions and this information can be quite detailed. The expert always beneĀ
ts from cheap talk if her preferences are quasiconvex, but is better off remaining silent if her preferences are quasiconcave. The model generates new results on the nature of persuasive advertising, the revenue gains from auction disclosure, the informational efficiency of voting rules, and the tradeoffs between cheap talk and delegation.