# Relational Communication

## TL;DR

This paper analyzes a repeated communication game where transfers influence the receiver's decisions and signal the sender's information, showing that pooling strategies are optimal when the receiver's response to information is highly sensitive.

## Contribution

It demonstrates that in repeated communication with transfers, pooling can be optimal under high responsiveness of the receiver's decision-making, extending understanding of equilibrium strategies.

## Key findings

- Full separation is always supported in equilibrium.
- Pooling is optimal when the receiver's decision is highly responsive.
- Pooling extreme states discourages defection.

## Abstract

We study a communication game between an informed sender and an uninformed receiver with repeated interactions and voluntary transfers. Transfers motivate the receiver's decision-making and signal the sender's information. Although full separation can always be supported in equilibrium, partial or complete pooling is optimal if the receiver's decision-making is highly responsive to information. In this case, the receiver's decision-making is disciplined by pooling extreme states where she is most tempted to defect.