Economía

Meaningful talk

Número
443
Autor
Jorge M. Streb y Gustavo Torrens
Mes/Año
02/2011
Adjunto
Resumen

Natural language is a shared social convention that allows hearers to understand speakers. We model this using two steps. First, an encoding-decoding step where the sender transmits verbal information to the receiver. Second, an inferential step where the receiver may either believe the literal meaning of the message or disregard it in updating priors. These epistemic steps sharply restrict the beliefs that may be entertained on and off the equilibrium path. When there are credible messages, natural language is a powerful means to select equilibria.