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Strategic decision-making and information transmission

Posted on:2002-02-01Degree:Ph.DType:Dissertation
University:Northwestern UniversityCandidate:Gerardi, DonatoFull Text:PDF
GTID:1469390011498148Subject:Economics
Abstract/Summary:
This dissertation deals with information transmission among individuals in a decision-making process. In the first essay I study strategic voting in juries when there is uncertainty about jurors' preferences. I show that under nonunanimous voting rules large juries make the correct decision with probability close to one. Under the unanimity rule large juries almost never convict the defendant. These results suggest that the unanimity rule can protect the innocent but only at the price of acquitting the guilty.; In the second essay I consider games with five or more players and rational parameters, and I characterize the set of outcomes that players can achieve with unmediated communication when the solution concept is sequential equilibrium. I show that this set coincides with the set of correlated equilibria in games with complete information, and with the set of communication equilibria in games with incomplete information and full support (i.e. games in which all profiles of types have positive probability). These results provide support for the use of correlated and communication equilibria. In fact, these solution concepts can be used to analyze the effects of adding communication to a game even if an impartial mediator is not available and players are sequentially rational.; I use my results on games with communication to solve the following mechanism design problem. An uninformed decision maker has to choose an action, the payoff of which depends on the unknown state of the world. The decision maker can consult a number of informed and interested experts. The goal of the decision maker is to find a way to elicit as much information as possible from the experts. I characterize the optimal mechanism when the decision maker cannot commit in advance to a course of actions and there are at least four experts.; Finally, in the third essay, I show that in Bayesian games with four or more players and rational parameters the set of outcomes that players can achieve with unmediated communication (when the solution concept is Nash equilibrium) coincides with the set of communication equilibria even if communication takes place only after players learn their types.
Keywords/Search Tags:Information, Decision, Communication, Players
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