Markovian Persuasion

Lehrer, Ehud; Shaiderman, Dimitry

Abstract

In the classical Bayesian persuasion model an informed player and an uninformed one engage in a static interaction. The informed player, the sender, knows the state of nature, while the uninformed one, the receiver, does not. The informed player partially shares his private information with the receiver and the latter then, based on her belief about the state, takes an action. This action determines, together with the state of nature, the utility of both players. We consider a dynamic Bayesian persuasion situation where the state of nature evolves according to a Markovian law. In this repeated persuasion model an optimal disclosure strategy of the sender should, at any period, balance between getting high stage payoff and future implications on the receivers' beliefs. We discuss optimal strategies under different discount factors and characterize when the asymptotic value achieves the maximal value possible.

Citation

Lehrer, E., & Shaiderman, D. (in press). Markovian Persuasion. Theoretical Economics,

• Journal Article Type: Article
• Acceptance Date: Sep 15, 2023
• Deposit Date: Aug 16, 2023
• Journal: Theoretical Economics
• Print ISSN: 1933-6837
• Electronic ISSN: 1555-7561
• Publisher: Econometric Society
• Peer Reviewed: Peer Reviewed
• Public URL: https://durham-repository.worktribe.com/output/1719365
• Publisher URL: https://onlinelibrary.wiley.com/journal/15557561
• Related Public URLs: https://doi.org/10.48550/arXiv.2111.14365