A Cheap-talk Model with Multiple Free-riding Audiences: Reference to Global Environmental Protections

Yeung, Timothy (2014) A Cheap-talk Model with Multiple Free-riding Audiences: Reference to Global Environmental Protections. TSE Working Paper, n. 14-503

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Official URL: http://tse-fr.eu/pub/28291

Abstract

This paper presents a cheap-talk one-sender-multiple-receiver model in which audiences freeride on each other in the context of global environmental protections. The sender observes the magnitude of damage of emission, and sends the same message simultaneously to all audiences, who then play a game to determine individual emission level. The sender may find it impossible to credibly send the truth when externality is large enough because of the incentive to correct free-riding behavior. If a private club is established for sharing information, the sender’s information with more countries may not be optimal because the sender is less truthful when the club is larger.

Item Type: Monograph (Working Paper)
Language: English
Date: June 2014
Uncontrolled Keywords: Cheap Talk, Externality, Environmental Protections
JEL codes: D82 - Asymmetric and Private Information
H41 - Public Goods
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Site: UT1
Date Deposited: 09 Jul 2014 17:46
Last Modified: 07 Mar 2018 13:23
OAI ID: oai:tse-fr.eu:28291
URI: http://publications.ut-capitole.fr/id/eprint/15947

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