On the Robustness of Strategic Experimentation to Persuasive Cheap Talk - Theoretical Economics Letters

TEL > Vol.2 No.5, December 2012

On the Robustness of Strategic Experimentation to Persuasive Cheap Talk ()

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Download as PDF (Size: 96KB) PP. 524-529

DOI: 10.4236/tel.2012.25097 4,695 Downloads 6,606 Views

Author(s)

Jonathan Rosborough

Affiliation(s)

Department of Economics, St. Francis Xavier University, Antigonish, Canada.

ABSTRACT

This paper develops a model in which a privately informed seller attempts to indirectly influence the experimentation strategy of a buyer by sending costless signals. The question under consideration is whether there is any credible way in which this single rational seller could influence the buyer’s decisions. We provide bounds on information transmission in equilibrium, and show that there exists no reporting strategy for the seller which changes the experimentation strategy of the buyer. These results demonstrate the robustness of a class of learning models to coercion.

KEYWORDS

Learning; Experimentation; Persuasion; Cheap Talk; Multi-Armed Bandits

Share and Cite:

Rosborough, J. (2012) On the Robustness of Strategic Experimentation to Persuasive Cheap Talk. Theoretical Economics Letters, 2, 524-529. doi: 10.4236/tel.2012.25097.

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