Doctoral Dissertation Research in Economics: Bayesian Persuasion in the Lab?

Ohio State University, The, Columbus OH

Investigators

Abstract

Bayesian Persuasion describes the phenomena where a sender of information intends to sway a receiver to take his/her desired action by choosing what information the receiver can access. This occurs in many economic and social settings, for example a prosecutor persuading a judge to convict a suspect or a politician persuading voters that he/she is the best candidate and therefore deserve their vote. While Bayesian Persuasion has been studied in theory, there has been little real world study of its implications. Given the prevalence and complexity of the use of Bayesian Persuasion, it is important to investigate whether the sender can find the best information to induce his/her desired action with the maximum frequency, and if not, what makes it so difficult. This proposed research will use a series of experiments to study the Bayesian Persuasion phenomenon. Such an investigation helps to build an understanding about several situations that involve Bayesian Persuasion, such as how a prosecutor chooses to investigate a criminal case and how politicians design their promotion campaigns. The results of this research will improve the efficiency of advertising, public policy campaigns, and general policy discussions. This project uses a series of lab experiments to test the theory of Bayesian Persuasion. The researchers will design laboratory experiments where the process of Bayesian Persuasion is maximally simplified for the sender. The experimental design will eliminate the need for the sender to perform any Bayesian updating. Because people are in general not capable of Bayesian updating, such simplification allows researchers to focus solely on the key parts of the Bayesian Persuasion reasoning. The experiment will then introduce some realistic difficulties to the problem to check the robustness of the results. The research goal is to shed light on the empirical soundness of the theory of Bayesian Persuasion---to what extent is the theoretical prediction correct and how should economists revise their understanding of the theory if necessary. The results of this research project will not only (in)validate the theory of Bayesian Persuasion but also show its practical application. This will improve discourse on important issues in business, public policy, and governance generally. This award reflects NSF's statutory mission and has been deemed worthy of support through evaluation using the Foundation's intellectual merit and broader impacts review criteria.