Business Language for Agents with Asymmetric Perceptions
Jack Stecher ()
No 225, Econometric Society 2004 Australasian Meetings from Econometric Society
This paper addresses the relationship between individual perceptions and the uses of a business language. Perceptions are modeled explicitly, and are not common knowledge. A business language enables individuals with different perceptions to trade. I present a formal criterion for faithfulness of the business language among heterogeneous agents. Roughly, the language is heterogeneously faithful if different agents who observe the same real-world object can perceive it in a way that leads them to make the same report. Different business languages lead to different possible equilibria, and thus can be Pareto-ranked. In particular, heterogeneously faithful languages are compared with one where agents can fully disclose what they perceive
Keywords: Reporting; Faithfulness; Full Disclosure; Perceptions (search for similar items in EconPapers)
JEL-codes: C65 D82 M41 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:ecm:ausm04:225
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