Working Papers
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"Coarse Information Design" (with Qianjun Lyu and Yimeng Zhang)
August 2023
Abstract. We study an information design problem with continuous state and discrete signal space. The designer’s interim value function affects the solution only through its curvature (second derivative), and there is a dual relation between this curvature and the prior density of the state. Under convex value functions, the optimal information structure is interval- partitional and we characterize the optimal interval cutoffs. In logconcave environments, a center of the scrutiny, measured by the widths of interval partitions, emerges and information becomes coarser for states farther from it. The analysis can be extended to S-shaped value functions.
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"Signaling under Double-Crossing Preferences: The Case of Discrete Types" (with Chia-Hui Chen and Junichiro Ishida)
July 2023
Abstract. The class of double-crossing preferences, where signaling is cheaper for higher types than for lower types at low signaling levels and the opposite is true at high signaling levels, underlines the phenomenon of countersignaling, with intermediate types choosing higher actions than higher and lower types. We provide an algorithm to systematically construct an equilibrium and thus establish equilibrium existence for this general class of preferences with an arbitrary discrete-type distribution. Our analysis sheds light on the connection between discrete-type and continuous-type models and clarifies robust predictions of signaling under double-crossing preferences.
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"Individual and Collective Information Acquisition: An Experimental Study" (with Pellumb Reshidi, Alessandro Lizzeri, Leeat Yariv, and Jimmy Chan)
July 2023
Abstract. Many committees—juries, political task forces, etc.—spend time gathering costly information before reaching a decision. We report results from lab experiments focused on such information-collection processes. We consider decisions governed by individuals and groups and compare how voting rules affect outcomes. We also contrast static information collection, as in classical hypothesis testing, with dynamic collection, as in sequential hypothesis testing. Several insights emerge. Static information collection is excessive, and sequential information collection is non-stationary, producing declining decision accuracies over time. Furthermore, groups using majority rule yield especially hasty and inaccurate decisions. Nonetheless, sequential information collection is welfare enhancing relative to static collection, particularly when unanimous rules are used.
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"Information Design in Cheap Talk" (with Qianjun Lyu)
March 2023
Abstract. An uninformed sender publicly commits to an informative experiment about an uncertain state, privately observes its outcome, and sends a cheap-talk message to a receiver. We provide an algorithm valid for arbitrary state-dependent preferences that will determine the sender’s optimal experiment, and give sufficient conditions for information design to be valuable or not under different payoff structures. These conditions depend more on marginal incentives—how payoffs vary with the state—than on the alignment of sender’s and receiver’s rankings over actions within a state. The algorithm can be easily modified to study canonical cheap talk game with perfectly informed sender.
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"Informative
Voting in Large Elections" (with
Ettore Damiano and Li Hao)
February 2023
Abstract. Recounting introduces multiple pivotal events in two-candidate elections. In large elections, the motive to avoid recounting cost can become the dominant consideration for rational voters, inducing them to vote informatively according to their private signals. In environments where elections without recounting fail to aggregate information efficiently, an election rule with recounting induces asymptotically efficient outcomes in the best equilibrium, with a vanishingly small probability of actually invoking a recount. In environments where efficient information aggregation obtains in elections without recounting, introducing recounting reduces the size of the electorate needed for the equilibrium outcome to converge to an efficient outcome.