Strategic Private Experimentation

We consider a model of persuasion in which an agent who tries to persuade a decision maker can sequentially acquire imperfect signals. The agent's information acquisition is unobservable and he has the option to hide unfavorable signals. Nevertheless, if the signal precision is sufficiently hig...

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Bibliographic Details
Published in:American economic journal. Microeconomics 2014-11, Vol.6 (4), p.74-105
Main Authors: Felgenhauer, Mike, Schulte, Elisabeth
Format: Article
Language:English
Subjects:
Analysis
Argumentation
Conditional probabilities
Decision making
Emission standards
Empirical evidence
Endowments
Expected utility
Experimentation
Experiments
Intelligent agents
Microeconomics
Persuasion
Signals
Studies
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Summary:We consider a model of persuasion in which an agent who tries to persuade a decision maker can sequentially acquire imperfect signals. The agent's information acquisition is unobservable and he has the option to hide unfavorable signals. Nevertheless, if the signal precision is sufficiently high, he can persuade the decision maker by revealing a sufficiently large number of favorable signals. When the number of signals that can be transmitted to the decision maker is limited, persuasion is impossible if the agent's stakes are too high.
ISSN:1945-7669
1945-7685
DOI:10.1257/mic.6.4.74