Can cheap talk overcome information disclosure in buyer-seller communication?

We compare two types of costless communication, Cheap Talk and Information Disclosure, in a buyer-seller interaction where the buyer has private information about his ideal location in the product space and the seller is entitled to make a takeit-or-leave-it offer comprising a product location and a...

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Autor principal: Coleff, Joaquín
Formato: Objeto de conferencia
Lenguaje:Inglés
Publicado: 2015
Materias:
Ciencias Económicas
cheap talk
disclosure
incomplete contracts
strategic communication
Acceso en línea:http://sedici.unlp.edu.ar/handle/10915/169691
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SEDICI (UNLP) de Universidad Nacional de La Plata
id I19-R120-10915-169691
record_format dspace
spelling I19-R120-10915-1696912024-09-06T04:08:12Z http://sedici.unlp.edu.ar/handle/10915/169691 Can cheap talk overcome information disclosure in buyer-seller communication? Coleff, Joaquín 2015-11 2015 2024-09-05T14:51:30Z en Ciencias Económicas cheap talk disclosure incomplete contracts strategic communication We compare two types of costless communication, Cheap Talk and Information Disclosure, in a buyer-seller interaction where the buyer has private information about his ideal location in the product space and the seller is entitled to make a takeit-or-leave-it offer comprising a product location and a price. We show that Cheap Talk can overcome Information Disclosure in terms of seller’s payoff and, generally, welfare. Under Information Disclosure, the buyer garbles the signal compared to the one in a Cheap Talk equilibrium to persuade a lower price which inevitably reduces profits. However, Information Disclosure may also reduce product attractiveness and, thus, welfare. Facultad de Ciencias Económicas Objeto de conferencia Objeto de conferencia http://creativecommons.org/licenses/by-nc-sa/4.0/ Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International (CC BY-NC-SA 4.0) application/pdf
institution Universidad Nacional de La Plata
institution_str I-19
repository_str R-120
collection SEDICI (UNLP)
language Inglés
topic Ciencias Económicas
cheap talk
disclosure
incomplete contracts
strategic communication
spellingShingle Ciencias Económicas
cheap talk
disclosure
incomplete contracts
strategic communication
Coleff, Joaquín
Can cheap talk overcome information disclosure in buyer-seller communication?
topic_facet Ciencias Económicas
cheap talk
disclosure
incomplete contracts
strategic communication
description We compare two types of costless communication, Cheap Talk and Information Disclosure, in a buyer-seller interaction where the buyer has private information about his ideal location in the product space and the seller is entitled to make a takeit-or-leave-it offer comprising a product location and a price. We show that Cheap Talk can overcome Information Disclosure in terms of seller’s payoff and, generally, welfare. Under Information Disclosure, the buyer garbles the signal compared to the one in a Cheap Talk equilibrium to persuade a lower price which inevitably reduces profits. However, Information Disclosure may also reduce product attractiveness and, thus, welfare.
format Objeto de conferencia
Objeto de conferencia
author Coleff, Joaquín
author_facet Coleff, Joaquín
author_sort Coleff, Joaquín
title Can cheap talk overcome information disclosure in buyer-seller communication?
title_short Can cheap talk overcome information disclosure in buyer-seller communication?
title_full Can cheap talk overcome information disclosure in buyer-seller communication?
title_fullStr Can cheap talk overcome information disclosure in buyer-seller communication?
title_full_unstemmed Can cheap talk overcome information disclosure in buyer-seller communication?
title_sort can cheap talk overcome information disclosure in buyer-seller communication?
publishDate 2015
url http://sedici.unlp.edu.ar/handle/10915/169691
work_keys_str_mv AT coleffjoaquin cancheaptalkovercomeinformationdisclosureinbuyersellercommunication
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