Meaningful Cheap Talk Must Improve Equilibrium Payoffs

Arvan, Lanny; Cabral, Luís M. B.; Santos, Vasco

http://hdl.handle.net/10362/87939

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Autores

Arvan, Lanny

Cabral, Luís M. B.

Santos, Vasco

Resumo(s)

We generalize Farrell's (1987) idea of coordination by means of cheap talk. We show that if cheap talk is meaningful (in a specific sense) and if there is room for cooperation (namely if there exists at least one pure-strategy equilibrium Pareto superior to the default equilibrium), then cheap talk must increase the equilibrium expected payoff relative to the play of the game without pre-play communication.

URI

http://hdl.handle.net/10362/87939

Citação

Arvan, Lanny, Cabral, Luís and Santos, Vasco, Meaningful Cheap Talk Must Improve Equilibrium Payoffs (March, 1995). FEUNL Working Paper Series No. 255

Editora

Nova SBE

Coleções

NSBE - Working Paper Series

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