Articles

Articles

False Advice as Signal of the Unbiased Advisor
  • Author
    Kyung-Young Park (Sungkyunkwan University)
  • Year
    2016
  • Volume
    Vol.64
  • Number
    No.1
  • When the decision maker is uncertain about the advisor’s type, an unbiased
    advisor has the incentive to act differently from a biased advisor in order to
    signal his type. If the biased advisor tells the truth, then the unbiased advisor
    gives false advice to the decision maker. This is because the unbiased advisor
    uses only one type of message to signal his type. Specifically, I show that
    there exists an equilibrium in which the unbiased advisor always lies but the
    biased always tells the truth, if the unbiased advisor cares about the future but
    the biased advisor the present and the bias of the biased advisor is small
    enough. This result is new compared to Kim et al. (2013). Also, I find
    several other equilibria.
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