Information Design with Unknown Decision-Maker's Preferences

We analyse the information transmission in cheap talk model with two periods between a advisor and reputational-concerned decision maker with apriori unknown bias. The decision maker can be biased or unbiased relative to the advisor. Too-high bias destroys advisor’s incentives for truth-telling. However, when reputational concerns are high, they force the biased decision maker to mimic the unbiased one, which leads to more informative communication in future. They might also support truth-telling in the first period for high value of bias. Although, when the agents care a lot about the future, the unbiased decision maker might have incentives to be separated and acts as if he has a bias, even if his preferences are perfectly aligned with the advisor’s utility. Generally increase in bias lowers the advisor’s utility but there are cases, when jump in bias value lead to higher payoff for the sender.