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This paper addresses the problem of data errors in discrete variables. When data errors occur, the observed variable is a misclassified version of the variable of interest, whose distribution is not identified. Inferential problems caused by data errors have been conceptualized through convolution and mixture models. This paper introduces the direct(More)
We compare three common dispute resolution processes — negotiation, mediation, and arbitration — in the framework of Crawford and Sobel (1982). Under negotiation, the two parties engage in (possibly arbitrarily long) face-to-face cheap talk. Under mediation, the parties communicate with a neutral third party who makes a non-binding recommendation. Under(More)
a r t i c l e i n f o a b s t r a c t We analyze the performance of various communication protocols in a generalization of the Crawford–Sobel (1982) model of cheap talk that allows for multiple receivers. We find that the sender prefers communicating by private messages if the receivers' average bias is high, and by public messages if the receivers' average(More)
This paper addresses the problem of data errors in discrete variables. When data errors occur, the observed variable is a misclassi…ed version of the variable of interest, whose distribution is not identi…ed. Inferential problems caused by data errors have been conceptualized through convolution and mixture models. This paper introduces the direct(More)
We consider a persuasion game where multiple experts with potentially con ‡icting self-interests attempt to persuade a decision-maker, say, a judge. The judge prefers to take an action that is most appropriate given the state of the world but the experts'preferences over the actions are independent of the state. The judge has no commitment power and takes(More)
We analyze commitment to employment in an environment in which an infinitely lived firm faces a sequence of finitely lived workers who differ in their ability to produce output. A worker's ability is initially unknown to both the worker and the firm. A worker's effort affects the information on ability conveyed by his performance. We characterize equilibria(More)
We study communication in a static Cournot duopoly model under the assumption that firms have unverifiable private information about their costs. We show that cheap talk between the firms cannot transmit any information. However, if the firms can communicate through a third party, communication can be informative even when it is not substantiated by any(More)
This paper investigates how the possibility of government subsidies to firms affects lending and managerial incentives. We develop a model that shows that government support can perform as implicit insurer of firms, which leads to two main effects: lowering incentives of managers and increase of incentives to finance. The equilibrium with government(More)