Pragmatic Ambiguity and Rational Miscommunication

Toru Suzuki

No 2021/04, Working Paper Series from Economics Discipline Group, UTS Business School, University of Technology, Sydney

Abstract: This paper provides a model of miscommunication in a common-interest setting. The speaker describes the state with a preexisting language to the decision-maker, whereas using a longer description is more costly. It is shown that, given any non-zero communication cost, any reasonably efficient equilibrium exhibits miscommunication caused by ambiguous descriptions whenever agents communicate across various occasions and their perceptions of occasions are imperfect but sufficiently accurate. Equilibrium miscommunication disappears when agents’ perceptions of occasions are too noisy, suggesting more accurate perceptions do not always reduce miscommunication. The model also provides insight into the miscommunication that triggered a well-known aircraft crash.

Keywords: Miscommunication; common-interest communication; pragmatic ambiguity; economics and language (search for similar items in EconPapers)
JEL-codes: D83 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2021-06-02
New Economics Papers: this item is included in nep-mic and nep-upt
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