In economics and game theory, Bayesian persuasion involves a situation where one participant (the sender) wants to persuade the other (the receiver) of a certain course of action. There is an unknown state of the world, and the sender must commit to a decision of what information to disclose to the receiver. Upon seeing said information, the receiver will revise their belief about the state of the world using Bayes' Rule and select an action. Bayesian persuasion was introduced by Kamenica and Gentzkow,[1] though its origins can be traced back to Aumann and Maschler (1995).
Bayesian persuasion is a special case of a principal–agent problem: the principal is the sender and the agent is the receiver. It can also be seen as a communication protocol, comparable to signaling games;[2] the sender must decide what signal to reveal to the receiver to maximize their expected utility. It can also be seen as a form of cheap talk.[3]