Year: 2024
Type: preprint
Abstract: We investigate a two-period Bayesian persuasion game, where the receiver faces a decision, akin to a one-armed bandit problem: to undertake an action, gaining noisy information and a corresponding positive or negative payoff, or to refrain. The sender's objective is to dissuade the receiver from taking action by furnishing information about the payoff. Our findings describe the optimal strategy for the amount and timing of information disclosure. In scenarios where the sender possesses knowledge of the receiver's first-period action or observes a noisy public signal correlated with it, the optimal strategy entails revealing information in the second period. If this alone proves to be insufficient to dissuade the receiver from acting, supplementary information is provided in the first period. In scenarios where information must be provided without conditioning on the receiver's first-period action, the optimal strategy entails revealing information exclusively in the first period.
Source: arXiv (Cornell University)
Institutions: University of Siena, Durham University, Tel Aviv University
Language: English
Topic: Game Theory and Applications
Field: Decision Sciences
Domain: Social Sciences
Open Access status: green
Awards: G1642027720, G1683070189
OpenAlex ID: W4390810388