"Persuasion with Probability and Text in a Sender-receiver Game", Dr. Jubo YAN, Assistant Professor, School of Social Sciences, Nanyang Technological University

Title: Persuasion with Probability and Text in a Sender-receiver Game
Speaker: Dr. Jubo YAN, Assistant Professor, School of Social Sciences, Nanyang Technological University
Date: September 25, 2025 (Thur.)
Time: 14:00–15:00
Location: T7-106-R1

Abstract:

Asymmetric information is prevalent in many economic settings and often leads to issues such as market inefficiency and adverse selection. In this study, we investigate the information transmission in a typical three-party market structure. A seller trying to sell physical or financial assets, a buyer (receiver) deciding whether to buy the asset, and a market intermediary (sender) who has private information about the quality of the sold asset. In our sender-receiver experiment, senders hold private, partial information about a binary state and their interests may be either aligned or misaligned with receivers, who observe only a common prior. Three implemented treatments include: 1) state only (baseline), in which only the state is communicated; 2) probability addition, in which the sender also reports his/her subjective probability that the state is truthful; and 3) text addition, in which the baseline recommendation is supplemented by a structured text message. Relative to state only, the text message yields the largest increase in receiver compliance, while probability message increases compliance only when reported probabilities lie in an intermediate (70–80%) range. Interestingly, the compliance level is positively associated with the extent of misreporting. Among the three treatments, misreporting is most pronounced when text is sent and, to a lesser extent, when probability is sent. In addition, when probability message is used, sender behavior differs by alignment: misaligned senders inflate probabilities compared to state only, whereas aligned senders moderate their reports. Finally, fact‐based text messages significantly increase compliance, messages revealing self-characteristics have no effect, and empty messages even reduce the compliance to a level below baseline.

Speaker Bio:

Dr. Jubo YAN is an assistant professor in Economics at Nanyang Technological University. He received his Ph.D. from the Charles H. Dyson School of Applied Economics and Management at Cornell University. Dr. Yan also holds a masters degree in financial economics as well as a bachelors degree in computer science. His primary research interests are behavioral economics and experimental economics especially the topics that concern individual decisions under risk and uncertainty. In addition, he also conducts research in applied microeconomics.