When does monitoring hurt? Endogenous information acquisition in a game of persuasion

Tsz-Ning Wong, Lily Ling Yang

Research output: Contribution to journalArticleScientificpeer-review

Abstract

We study a persuasion game between a decision maker and an expert. Before communication, the expert searches for an evidence about the state of nature. Higher effort leads to a higher probability of discovery. We show that, contrary to everyday experiences, monitoring of effort is always suboptimal if the expert’s bias is large, yet sometimes optimal if the expert’s bias is small.
Original languageEnglish
Pages (from-to)186–189
JournalECONOMICS LETTERS
Volume163
DOIs
Publication statusPublished - Feb 2018
MoE publication typeA1 Journal article-refereed

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