ShanghaiTech SEM Working Paper No. 2022-005
Wenhao Wu
ShanghaiTech University
This paper studies a one-sender-one-receiver disclosure game with general receiver preferences and message structures. Drawing on techniques from information design, I provide a characterization of the Perfect Bayesian Equilibrium outcomes. I find that any PBE can be interpreted as a combination of cheap talk equilibria in a partitional form. I revisit Milgrom (1981, 2008) and identify conditions for the classic unraveling result. I provide an algorithm to construct a PBE in games with linear disclosure structure. In addition, I apply the theory to examples of labor markets and political campaigns. The theory explains why communication usually involves presentation of evidence and randomization over messages.
Date Written: September 7, 2022
Available at SSRN: https://ssrn.com/abstract=4212160212160
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【No. 2022-005】A Role for Cheap Talk in Disclosure.pdf
