Bayesian persuasion

Bayesian persuasion

by Emir Kamenica

Book 15540 of NBER working paper series -- working paper

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"LIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd">Bayesian Persuasion var djConfig = { parseOnLoad: true, isDebug: false };NATIONAL BUREAU OF ECONOMIC RESEARCH HOME PAGE Bayesian PersuasionUse a mirror (1048 K)Emir Kamenica, Matthew Gentzkow NBER Working Paper No. 15540*Issued in November 2009NBER Program(s): IO POLWhen is it possible for one person to persuade another to change her action? We take a mechanism design approach to this question. Taking preferences and initial beliefs as given, we introduce the notion of a persuasion mechanism: a game between Sender and Receiver defined by an information structure and a message technology. We derive necessary and sufficient conditions for the existence of a persuasion mechanism that strictly benefits Sender. We characterize the optimal mechanism. Finally, we analyze several examples that illustrate the applicability of our results"--National Bureau of Economic Research web site.

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