Meaningful Talk

Serie Documentos de Trabajo UCEMA No. 443 (Revised September 2013)

41 Pages Posted: 4 Mar 2011 Last revised: 13 Sep 2013

Date Written: February 2011


Natural language is a shared social convention that allows hearers to understand speakers. We model this using two steps. First, an encoding-decoding step where the sender transmits verbal information to the receiver. Second, an inferential step where the receiver may either believe the literal meaning of the message or disregard it in updating priors. These epistemic steps sharply restrict the beliefs that may be entertained on and off the equilibrium path. When there are credible messages, natural language is a powerful means to select equilibria.

Keywords: cheap talk, signs, linguistic symbols, literal meaning, equilibrium meaning

JEL Classification: D83, C72

Suggested Citation

Streb, Jorge Miguel and Torrens, Gustavo, Meaningful Talk (February 2011). Serie Documentos de Trabajo UCEMA No. 443 (Revised September 2013), Available at SSRN: or

Jorge Miguel Streb (Contact Author)

Universidad del CEMA ( email )

Av. Cordoba 374
Buenos Aires, CABA


Gustavo Torrens

Indiana university ( email )

Wylie Hall, 100 S Woodland Ave
Bloomington, IN 47405-7104
United States
8128568131 (Phone)
47405-7104 (Fax)

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