Rational exaggeration and counter-exaggeration in information aggregation games
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| 024 | 7 | 0 | |a 10.1007/s00199-015-0870-2 |2 doi |
| 035 | |a (NATIONALLICENCE)springer-10.1007/s00199-015-0870-2 | ||
| 245 | 0 | 0 | |a Rational exaggeration and counter-exaggeration in information aggregation games |h [Elektronische Daten] |c [Gordon Rausser, Leo Simon, Jinhua Zhao] |
| 520 | 3 | |a We study an information aggregation game in which each of a finite collection of "senders” receives a private signal and submits a report to the center, who then makes a decision based on the average of these reports. The integration of three features distinguishes our framework from the related literature: players' reports are aggregated by a mechanistic averaging rule, their strategy sets are intervals rather than binary choices, and they are ex ante heterogeneous. In this setting, players engage in a "tug-of-war,” as they exaggerate and counter-exaggerate in order to manipulate the center's decision. While incentives to exaggerate have been studied extensively, the phenomenon of counter-exaggeration is less well understood. Our main results are as follows. First, the cycle of counter-exaggeration can be broken only by the imposition of exogenous bounds on the space of admissible sender reports. Second, in the unique pure-strategy equilibrium, all but at most one player is constrained with positive probability by one of the report bounds. Our third and fourth results hold for a class of "anchored” games. We show that if the report space is strictly contained in the signal space, then welfare is increasing in the size of the report space, but if the containment relation is reversed, welfare is independent of the size of the space. Finally, the equilibrium performance of our heterogeneous players can be unambiguously ranked: a player's equilibrium payoff is inversely related to the probability that her exaggeration will be thwarted by the report bounds. | |
| 540 | |a Springer-Verlag Berlin Heidelberg, 2015 | ||
| 690 | 7 | |a Information aggregation |2 nationallicence | |
| 690 | 7 | |a Majority rule |2 nationallicence | |
| 690 | 7 | |a LIBOR |2 nationallicence | |
| 690 | 7 | |a Baltic Dry Index |2 nationallicence | |
| 690 | 7 | |a Yelp |2 nationallicence | |
| 690 | 7 | |a Online reviews |2 nationallicence | |
| 690 | 7 | |a Exaggeration |2 nationallicence | |
| 690 | 7 | |a Counter-exaggeration |2 nationallicence | |
| 690 | 7 | |a Mean versus median mechanism |2 nationallicence | |
| 690 | 7 | |a Strategic communication |2 nationallicence | |
| 690 | 7 | |a Incomplete-information games |2 nationallicence | |
| 690 | 7 | |a Strategic information transmission |2 nationallicence | |
| 700 | 1 | |a Rausser |D Gordon |u Department of Agricultural and Resource Economics, University of California at Berkeley, 207 Giannini Hall, 94720-3310, Berkeley, CA, USA |4 aut | |
| 700 | 1 | |a Simon |D Leo |u Department of Agricultural and Resource Economics, University of California at Berkeley, 207 Giannini Hall, 94720-3310, Berkeley, CA, USA |4 aut | |
| 700 | 1 | |a Zhao |D Jinhua |u Department of Economics, Department of Agricultural, Food and Resource Economics, Michigan State University, 205A Old Botany, 48824, East Lansing, MI, USA |4 aut | |
| 773 | 0 | |t Economic Theory |d Springer Berlin Heidelberg |g 59/1(2015-05-01), 109-146 |x 0938-2259 |q 59:1<109 |1 2015 |2 59 |o 199 | |
| 856 | 4 | 0 | |u https://doi.org/10.1007/s00199-015-0870-2 |q text/html |z Onlinezugriff via DOI |
| 898 | |a BK010053 |b XK010053 |c XK010000 | ||
| 900 | 7 | |a Metadata rights reserved |b Springer special CC-BY-NC licence |2 nationallicence | |
| 908 | |D 1 |a research-article |2 jats | ||
| 949 | |B NATIONALLICENCE |F NATIONALLICENCE |b NL-springer | ||
| 950 | |B NATIONALLICENCE |P 856 |E 40 |u https://doi.org/10.1007/s00199-015-0870-2 |q text/html |z Onlinezugriff via DOI | ||
| 950 | |B NATIONALLICENCE |P 700 |E 1- |a Rausser |D Gordon |u Department of Agricultural and Resource Economics, University of California at Berkeley, 207 Giannini Hall, 94720-3310, Berkeley, CA, USA |4 aut | ||
| 950 | |B NATIONALLICENCE |P 700 |E 1- |a Simon |D Leo |u Department of Agricultural and Resource Economics, University of California at Berkeley, 207 Giannini Hall, 94720-3310, Berkeley, CA, USA |4 aut | ||
| 950 | |B NATIONALLICENCE |P 700 |E 1- |a Zhao |D Jinhua |u Department of Economics, Department of Agricultural, Food and Resource Economics, Michigan State University, 205A Old Botany, 48824, East Lansing, MI, USA |4 aut | ||
| 950 | |B NATIONALLICENCE |P 773 |E 0- |t Economic Theory |d Springer Berlin Heidelberg |g 59/1(2015-05-01), 109-146 |x 0938-2259 |q 59:1<109 |1 2015 |2 59 |o 199 | ||