Two-dimensional cheap talk: Necessary and sufficient conditions for perfect revelation in one dimension

  • Luis Alberto Romero Ibarra Secretaría de Hacienda y Crédito Público
Keywords: two dimensional, perfect revealing equilibrium in the dimension of agreement
JEL Classification: C72, D82

Abstract

This paper develops a model of cheap talk à la Crawford and Sobel whose state variable takes values within the unit square. No characterization of all equilibria has been found. This paper focuses on equilibria where the Sender reveals all the information in the direction that is perpendicular to the vector of disagreement. The foremost result of this analysis states that there exists perfect revelation in this dimension if and only if the random state vector has components that are independent in the directions of agreement and disagreement.

References

Battaglini, M. (2002). Multiple Referrals and Multidimensional Cheap Talk, Econometrica, 70(4), 1379-1401.

Crawford, V. P. y J. Sobel (1982). Strategic Information Transmition, Econometrica, 50(6), 1431-1451.

Gilligan, T. W. y K. Krehbiel (1989). Asymmetric Information and Legislative Rules with a Heterogeneous Committee, American Journal of Political Science, 33(2), 459-490.

Krishna, V. y J. Morgan (2001). A Model of Expertise, Quarterly Journal of Economics, 116(2), 747-775.

Levy, G. y R. Razin (2007). On the Limits of Communication in Multidimensional Cheap Talk: A Comment, Econometrica, 75(3), 885-893.

Levy, G. y R. Razin (2004). Multidimensional Cheap Talk, CEPR Discussion Paper, núm. 4393.

Mas-Colell, A., M. D. Whinston y J. R. Green (1995). Microeconomic Theory, Oxford University Press, Nueva York.

Published
01-07-2009
How to Cite
Romero IbarraL. (2009). Two-dimensional cheap talk: Necessary and sufficient conditions for perfect revelation in one dimension. Estudios Económicos, 24(2), 303-313. https://doi.org/10.24201/ee.v24i2.121
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