Selective revelation of public information and self-confirming equilibrium
International Journal of Game Theory, .
- Author's Original
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We model aggregate information release, in a dynamic setting with random matching, as a conscious, preference-driven choice. We introduce a "planner", who possesses and selectively reveals aggregate information. Aggregate information is gathered slowly, by taking small samples from the population, and can only be revealed after the dynamic process has stabilized. By selectively revealing information, the planner may upset a given self-conforming equilibrium, in order to achieve a preferred outcome for him. Hence, some self-conforming equilibria are "unstable" relative to public information release. We show that only equilibria supported by heterogeneous beliefs can be information-unstable. We provide several real-life examples of manipulation by means of public information, showing the relevance of the theoretical analysis.
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