Strategic Learning and Information Transmission

Abstract: It is often the case that an expert needs to explore the state of the world before advising a decision maker. We consider a dynamic cheap talk environment with gradual expert’s learning. Both players know what experiments are available to the expert. We show that the gradualness in expert’s learning can enhance informativeness in communication even when the learning process is endogenous (part of the expert’s strategy), unobservable by the decision maker and non-verifiable. The result suggests that even in the absence of an “objective” reason to hurry with information transmission, putting the expert in some form of “strategic” pressure can be beneficial to both players.