City Research Online

Abstract

Advances in the field of economics and psychology have contributed greatly to the understanding of the supply of information when it affects the emotions and consequently the decisions made by two parties. Yet, these studies assume the parties have identical utilities. In this paper, focusing on the doctor-patient interaction, we relax the perfect agency assumption, introduce the agent’s effort in supplying information, and analyse the two parties' interdependent decisions under asymmetric information. We show that when the supplier of information fails to understand the receiver’s preferences the latter will disregard completely the recommendation. We consider the policy recommendations and welfare implications of the model.

Publication Type:	Article
Additional Information:	This is a pre-copyedited, author-produced PDF of an article accepted for publication in CESifo Economic Studies following peer review. The version of record Glycopantis, D & Stavropoulou, C (2011). The supply of information in an emotional setting. CESifo Economic Studies, 57(4), pp. 740-762 is available online at: http://dx.doi.org/10.1093/cesifo/ifr024
Publisher Keywords:	supply of information, Psychological Expected Utility, non-cooperative game theory, doctor-patient relationship, policy recommendations, welfare implications
Subjects:	R Medicine > RC Internal medicine Z Bibliography. Library Science. Information Resources > Z665 Library Science. Information Science
Departments:	School of Health & Psychological Sciences > Healthcare Services Research & Management
SWORD Depositor:	Symplectic Administrator

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