Secret Communication with Plausible Deniability

Abstract

Communication is secret if a message is independent of the state; however, the receiver's subsequent action may still reveal that she has acted on hidden information. This paper studies when secret communication can also provide plausible deniability: under single-crossing preferences, every action induced by the sender's message must be rationalizable using the receiver's baseline information alone. We characterize joint information structures that satisfy both secrecy and plausible deniability. We show that plausible deniability restricts communication exactly when the baseline message is directional -- meaning its likelihood is monotone in the state. Combining this restriction with secrecy, we show that, for directional messages, frontier communication reveals at most whether the state lies above or below a cutoff. Finally, we identify conditions under which a greatest feasible communication structure exists and can be constructed explicitly in a simple way.