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Communication, Risk, and Efficiency in Games

  • Blume, Andreas

This paper studies the evolution of effective pre-play communication in games where a single communication round precedes a simultaneous-move, complete-information game. The paper identifies stable outcomes under population learning dynamics in which individuals with some probability replace their current strategy with a best reply against beliefs supported on a sample of currently used strategies. It is shown that under these conditions the effectiveness of one-sided pre-play communication is inversely related to risk in the underlying game, and to the size of the message space. Multi-sided communication can be shown to be more effective than one-sided communication; i.e., risk and the size of the message space play no role. This requires that all players communicate, have the same preferred equilibrium and messages have some small a priori information content that identifies message profiles that signal agreement on a strict equilibrium in the underlying game.

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Article provided by Elsevier in its journal Games and Economic Behavior.

Volume (Year): 22 (1998)
Issue (Month): 2 (February)
Pages: 171-202

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Handle: RePEc:eee:gamebe:v:22:y:1998:i:2:p:171-202
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/622836

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  1. Russell Cooper & Douglas V. DeJong & Robert Forsythe & Thomas W. Ross, 1992. "Communication in Coordination Games," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 739-771.
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  14. Ritzberger, Klaus & Weibull, Jorgen W, 1995. "Evolutionary Selection in Normal-Form Games," Econometrica, Econometric Society, vol. 63(6), pages 1371-99, November.
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