Year: 2016
Type: conference-paper
Abstract: We examine information structure design, also called "persuasion" or "signaling," in the presence of a constraint on the amount of communication. We focus on the fundamental setting of bilateral trade, which in its simplest form involves a seller with a single item to price, a buyer whose value for the item is drawn from a common prior distribution over n different possible values, and a take-it-or-leave-it-offer protocol. A mediator with access to the buyer's type may partially reveal such information to the seller in order to further some objective such as the social welfare or the seller's revenue. We study how a limit on the number of bits of communication affects this setting in two respects: (1) How much does this constraint reduce the optimal welfare or revenue? (2) What effect does constraining communication have on the computational complexity of the mediator's optimization problem?
Authors: Shaddin Dughmi, David Kempe, Ruixin Qiang
Institution: University of Southern California
Language: English
Field: Decision Sciences
Domain: Social Sciences
Open Access status: bronze
Funder: National Science Foundation
OpenAlex ID: W2464041947