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Rich language and refinements of cheap-talk equilibria
Authors:Wojciech Olszewski
Institution:Department of Economics, Northwestern University, 2003 Sheridan Road, Evanston, IL 60202, USA
Abstract:I formalize the notion of equilibrium language, define the relation of having a richer language, and show the existence of equilibria with maximally rich language. I also study the stability of equilibria with respect to inflows of messages that can enrich their language, and provide examples of implausible cheap-talk equilibria, not refined away by the existing refinements, which can be refined away on the grounds of stability properties.
Keywords:C72
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