Capabilities, Competition and Innovation Seminars
Communicating about Endogenous Issues
Doron Ravid (University of Chicago), joint with Elliot Lipnowski
Thursday 23 January 2025 13:45 - 15:00
MAR 6.33, 6th floor, The Marshall Building, 44 Lincoln's Inn Fields, London WC2A 3LY
About this event
A sender communicates about a multidimensional state with a receiver who is boundedly rational: he is restricted to interpreting the sender's messages as describing the best course of action in a small number of endogenously chosen issues. We model this restriction by requiring the receiver to use a low-dimensional linear strategy. Both players would like the action to be perfectly tailored to the state, but they may have different preferences, disagreeing over which aspects of the state are most important to match. We find that equilibrium is shaped only by the sender's perspective, because she cannot jointly communicate issues she deems differentially important. We identify a new equilibrium miscoordination risk, whereby the players may end up communicating about issues both players find to be minute. A receiver concerned about such a risk may prefer a sender with a differing perspective.
Participants are expected to adhere to the CEP Events Code of Conduct.
Directions
This event will take place in MAR 6.33, 6th floor, The Marshall Building, 44 Lincoln's Inn Fields, London WC2A 3LY.
The building is labelled MAR on the LSE campus map. You can also find us on Google Maps. For further information, go to contact us.This series is part of the CEP's Growth programme.