Cheap talk

In game theory, cheap talk is communication between players which does not directly affect the payoffs of the game. Providing and receiving information is free. This is in contrast to signaling in which sending certain messages may be costly for the sender depending on the state of the world. This basic setting set by Crawford and Sobel has given rise to a variety of variants. To give a formal definition, cheap talk is communication that is, according to Farrel so an agent engaging in cheap talk can lie with impunity (but may choose in equilibrium not to do so).

Cheap talk

In game theory, cheap talk is communication between players which does not directly affect the payoffs of the game. Providing and receiving information is free. This is in contrast to signaling in which sending certain messages may be costly for the sender depending on the state of the world. This basic setting set by Crawford and Sobel has given rise to a variety of variants. To give a formal definition, cheap talk is communication that is, according to Farrel so an agent engaging in cheap talk can lie with impunity (but may choose in equilibrium not to do so).