The Value of Mediated Communication

Andrés Salamanca Lugo (1)

1 TSE-R - Toulouse School of Economics

Kamenica and Gentzkow (2011) consider a model in which a sender chooses a public communication device for signaling his information to an uninformed receiver, who then takes an action that affects the welfare of both individuals. In their model, the sender is fully committed to truthfully communicate the signal to the receiver, so that they abstract from incentive compatibility issues. By considering mediated communication, we provide an analytical framework overcoming this overly restrictive assumption. We use the concept of virtual utility to develop a geometric approach to the sender's optimization problem. We characterize the value of persuasion from the concavification of a non-revealing function over beliefs. We apply our approach to a model of information transmission based on Crawford and Sobel (1982). In this setting, we provide necessary and sufficient conditions for the sender to benefit from his private information.

Mots clés: Bayesian persuasion; mediated communication; incentive compatibility; virtual utility

Domaines: Economies et finances

Andrés Salamanca Lugo. The Value of Mediated Communication. 2016. ⟨hal-01289379v1⟩