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Chapter 8: Cheap Talk and Incentives to Misrepresent

Chapter 8: Cheap Talk and Incentives to Misrepresent

pp. 191-214

Authors

, University of Pittsburgh
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Extract

How can states resolve problems with uncertainty? The most basic way is simply to ask. This chapter shows the unfortunately inherent limitations of such a strategy. If types were to reveal their private information truthfully, weaker types would receive fewer concessions. In turn, those types have an incentive to misrepresent themselves as stronger. Such a desire to take advantage of cheap talk communications continues when mediators are involved, though mediators with their own private information and the right type of bias may see some success.

Keywords

  • cheap talk
  • incentives to misrepresent
  • shuttle diplomacy
  • information provision

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