Date of This Version
10-26-2023
Abstract
For two periods an expert E announces his forecast of the state to a decision-maker D who chooses action. They disagree about the precision of the probability assessments. At the end of period 1 the state is observed. In the last period E makes announcements more extreme than his forecasts. Despite countable equilibria, full revelation is never realised. When in period 1 E is interested in reputation only, the initial equilibrium partition is finite; E makes announcements of greater uncertainty with respect to his forecasts. When E is interested in action too, reputational concerns mitigate exaggerated reports.
Recommended Citation
Valsecchi, Irene, "Forecasts as Repeated Cheap Talk from an Expert of Unknown Statistical Bias" (October 26, 2023). Fondazione Eni Enrico Mattei Working Papers. Paper 1421.
https://services.bepress.com/feem/paper1421