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Relational Communication

  • KanKan
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Document pages: 48 pages

Abstract: We study a communication game between an informed sender and an uninformedreceiver with repeated interactions and voluntary transfers. Transfers motivatethe receiver s decision-making and signal the sender s information. Althoughfull separation can always be supported in equilibrium, partial or completepooling is optimal if the receiver s decision-making is highly responsive toinformation. In this case, the receiver s decision-making is disciplined bypooling extreme states where she is most tempted to defect.

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