Cheap-Talk Referrals of Differentiated Experts in Repeated Relationships <link rel="stylesheet" typetext/css href="../toc/style.css"/> </head> <body> <table id="banner" width="100%" bgcolor="#FFFFFF" cellpadding="3" summary="t1"> <tbody> <tr> <td> <table width="100%" bgcolor="#3399CC" cellpadding="5" cellspacing="3" summary="banner"> <tbody> <tr> <td><font size="-1" face="arial" color="#FFFFFF">The RAND Journal of Economics<br /> 1776 Main Street<br /> Santa Monica, CA 90401</font><br /> <br /> <br /> <a class="four" href="http://www.rje.org">Home</a> <a class="four" href="http://www.rje.org/contact.html">Contact Us</a> <a class="four" href="http://www.rje.org/search.html">Search</a></td> <td align="right" valign="top"> <h1>The RAND Journal<br /> of Economics</h1> </td> </tr> </tbody> </table> </td> </tr> <tr> <td> <table width="100%" bgcolor="#FFFFCC" summary="menu"> <tbody> <tr> <td class="one"><a class="one" href="http://www.blackwellpublishing.com/editors.asp?ref=0741-6261" target="new"> Editorial | </a> <a class="one" href="http://www.blackwellpublishing.com/journal.asp?ref=0741-6261&site=1" target="new">Forthcoming | </a><a class="one" href="http://www.rje.org/sup-mat.html" target="new">Supplementary Material | </a> <a class="one" href="https://editorialexpress.com/cgi-bin/rje_online.cgi?action=browse&tid=38330&sc=eQW1ucsi" target="new">Tables of Contents | </a><a class="one" href="http://www.blackwell-synergy.com/action/doUpdateAlertSettings?journalCode=RAND&action=addJournal" target="new">E-Table of Contents | </a><a class="one" href="http://www.rje.org/styleguide.html" target="new">Style Guide | </a><a class="one" href="http://www.rje.org/iolinks.html" target="new">IO Links </a></td> </tr> </tbody> </table> </td> </tr> </tbody> </table> <div class="navtrail"> <a href="/">RJE Home</a> </div> <div id="threecolumn"> <div id="leftcolumn"></div> <div id="rightcolumn"> <table width="100%" cellpadding="5" cellspacing="5" summary="side_menu"> <tbody> <tr> <td align="center" bgcolor="#3399CC"><a class="four" href="http://editorialexpress.com/rand" target="new">Online Submissions</a></td> </tr> <tr> <td align="center" bgcolor="#3399CC"><a class="four" href="http://www.rje.org/subs.html" target="new">Online Access</a></td> </tr> <tr> <td align="center" bgcolor="#3399CC"><a class="four" href="http://gemini.econ.umd.edu/cgi-bin/rje_online.cgi" target="new">Order PDFs</a></td> </tr> <tr> <td align="center" bgcolor="#3399CC"><a class="four" href="http://www.blackwellpublishing.com/subs.asp?ref=0741-6261" target="new" target="new">Subscribe/Renew</a></td> </tr> <tr> <td align="center" bgcolor="#3399CC"><a class="four" href="http://www.rje.org/nobel.html" target="new">Nobel Laureates</a></td> </tr> <tr> <td align="center" height="31" width="88"><img src="/images/valid-xhtml10.png" alt="valid xhtml 1.0 transitional" /></td> </tr> </tbody> </table> </div> <div id="content">  <h1> Cheap-Talk Referrals of Differentiated Experts in Repeated Relationships <p></h1><hr> <strong>Volume:</strong> Volume 36, No. 2<p> <strong>Issue:</strong> Summer 2005<p> <strong>Pages: </strong>391-411 <p> <strong>Authors:</strong> In-Uck Park <p> <strong>Title:</strong> Cheap-Talk Referrals of Differentiated Experts in Repeated Relationships <p> <strong>Abstract:</strong> The effectiveness of cheap talk advice is examined in recurrent relationships between a customer and multiple experts who provide differentiated professional services. The main findings are: (i) Full honesty is not sustainable if the profitability of service provision varies widely across problems. (ii) As there are more experts due to finer specialization, the maximum equilibrium honesty level deteriorates. (iii) Nonetheless, the equilibria that satisfy an internal consistency condition, implement the same (unique) honesty level regardless of the number of experts. Furthermore, the customer can extract this honesty level by consulting a ``panel'' of only one or two (but no more) experts all the time. <p> <hr> <ul style="padding-bottom:8px; font-size:11px"> <li><A HREF="http:/cgi-bin/hmrp/rje-ice-form.pl"> Search Abstracts</A> <li><A HREF="http://gemini.econ.umd.edu/cgi-bin/rje_online.cgi"> Order Back Issues or Articles </ul> </div> </div>  <div id="footer" style="background:#ffffff; padding:8px" align="center"> <p style="font-size:11px">Copyright © 2008 RAND Journal of Economics. <a href="mailto:RJE@rand.org">RJE@rand.org</a></p> </div>   </div> </body></html>