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Konrad MIERENDORFF (UCL) – "Keeping the Listener Engaged: a Dynamic Model of Bayesian Persuasion"
CREST Microeconomics Seminar :
Date: 04th November 2020
We consider a dynamic model of Bayesian persuasion. Over time, a sender performs a series of experiments to persuade a receiver to take a desired action. Due to constraints on the information flow, the sender must take real time to persuade, and the receiver may stop listening and take a final action at any time. In addition, persuasion is costly for both players. To incentivize the receiver to listen, the sender must leave rents that compensate his listening costs, but neither player can commit to her/his future actions. Persuasion may totally collapse in Markov perfect equilibrium (MPE) of this game. However, for persuasion costs sufficiently small, a version of a folk theorem holds: outcomes that approximate Kamenica and Gentzkow (2011)’s sender-optimal persuasion as well as full revelation (which is most preferred by the receiver) and everything in between are obtained in MPE, as the cost vanishes. Joint with Y. Che and K.Kim
Roxana Fernandez Machado (CREST), Julien Combe (CREST), and Matias Nunez (CREST)