We develop a reputational cheap talk model where the principal mightcancel an action initially recommended by the expert if she gets an un-favourable interim news. Once the status quo is reinstated, however, theprincipal is unable to verify the true state of the world. Since the expertwants to appear well-informed, we first study the effect of the interimnews on the expert's reporting strategy. We find that the possibility ofcancelling the reform encourages the less well informed expert to recommend it more often. We then show that having access to better interimnews could reduce the welfare of the principal. Our model implies thatdelegating the decision rights to another person with different preferencescan be used as a commitment device by the principal and might improveher welfare.
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