When Words are not Enough

Research output: Contribution to journalArticleAcademicpeer-review

1 Citation (Scopus)

Abstract

Communication through ordinary talk is very common. Often, the receiver of information has the option to investigate a sender’s type. We extend a standard cheap-talk model by giving the receiver this option. We show that when the receiver bears most of the investigation cost, the option to investigate drives away most cheap-talk communication. When the sender pays a substantial part of the investigation cost, the option to investigate disciplines the sender. Introducing an investigation device to a cheap-talk model demonstrates the vulnerability of cheap talk on the one hand, and shows how communication can be improved on the other.
Original languageEnglish
Pages (from-to)294-314
Number of pages21
JournalJournal of Economic Behavior and Organization
Volume149
DOIs
Publication statusPublished - 16 Apr 2018

Fingerprint

Dive into the research topics of 'When Words are not Enough'. Together they form a unique fingerprint.

Cite this