Cheap Talk with Transparent Motives

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Paper: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2941601 

We study a model of cheap talk with one substantive assumption: the sender's preferences are state-independent. We observe that this setting is amenable to the belief-based approach familiar from models of persuasion with commitment. Using this approach, we examine the possibility of valuable communication, assess the value of commitment, and explicitly solve for sender-optimal equilibria in a large class of examples. A key result is a geometric characterization of the value of cheap talk, described by the quasiconcave envelope of the sender's value function.

Joint with Elliot Lipnowski

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