Ambiguous language and common priors

Standard economic models cannot capture the fact that information is often ambiguous, and is interpreted in multiple ways. Using a framework that distinguishes between the language in which statements are made and the interpretation of statements, we demonstrate that, unlike in the case where there...

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Bibliographic Details
Published in:Games and economic behavior 2015-03, Vol.90, p.171-180
Main Authors: Halpern, Joseph Y., Kets, Willemien
Format: Article
Language:English
Subjects:
Agree to disagree
Ambiguous language
Common prior
Economic models
Game theory
Harsanyi doctrine
Language
Studies
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Summary:Standard economic models cannot capture the fact that information is often ambiguous, and is interpreted in multiple ways. Using a framework that distinguishes between the language in which statements are made and the interpretation of statements, we demonstrate that, unlike in the case where there is no ambiguity, players may come to have different beliefs starting from a common prior, even if they have received exactly the same information, unless the information is common knowledge.
ISSN:0899-8256
1090-2473
DOI:10.1016/j.geb.2015.01.007