CeDEx workshop - Tore Ellingson (Stockholm School of Economics)

(joint with Senior Academic Seminar Series)

How Does Communication Affect Beliefs?

Abstract

This paper experimentally studies communication of intentions in nine different one-shot normal form games. In order to identify the effect of communication on beliefs, we control preferences by encouraging subjects to behave selfishly. We find that communication improves coordination in some games, but hampers coordination in other games. Overall, the evidence is better explained by the level-k model of beliefs than by refinements of rationalizability.