Communication under language barriers

We study the welfare effect of language barriers in communication. Specifically, we compare the equilibrium welfare in a game with language barriers to that in the equivalent game without language barriers. We show how and why language barriers may (weakly) improve welfare by providing two positive...

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Vydáno v:Journal of economic theory Ročník 180; s. 274 - 303
Hlavní autoři: Giovannoni, Francesco, Xiong, Siyang
Médium: Journal Article
Jazyk:angličtina
Vydáno: Elsevier Inc 01.03.2019
Témata:
Cheap talk
Communication
Information transmission
Language barriers
Mediation
Noisy talk
Noisy talk
Language barriers
Cheap talk
Mediation
Information transmission
D83
C72
D82
Communication
ISSN:0022-0531, 1095-7235
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Popis
Shrnutí:We study the welfare effect of language barriers in communication. Specifically, we compare the equilibrium welfare in a game with language barriers to that in the equivalent game without language barriers. We show how and why language barriers may (weakly) improve welfare by providing two positive results. First, in a game with any language barriers, we prove that if we allow for N-dimensional communication, any equilibrium outcome of the equivalent game without language barriers can be replicated. Second, for any payoff primitive, we provide a welfare ranking for several noisy-communication devices, including language barriers, that generalizes the results in Goltsman et al. (2009). In particular, our results imply that there always exist some language barriers whose maximal equilibrium welfare (always weakly and sometimes strictly) dominates any noisy-talk equilibrium (and hence also any cheap-talk equilibrium) under no language barriers.
ISSN:0022-0531
1095-7235
DOI:10.1016/j.jet.2018.12.009