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Preferences vs. strategic thinking: An investigation of the causes of overcommunication

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  • Lafky, Jonathan
  • Lai, Ernest K.
  • Lim, Wooyoung

Abstract

The extent of information sharing in strategic communication experiments persistently exceeds what theory predicts. The literature identifies homegrown preferences and heterogeneity in strategic thinking as two major causes of overcommunication. We design an experiment that features team decisions and combines strategic and non-strategic communication to evaluate these competing explanations. We find that (a) the vast majority of strategic truthful behavior in communication of private information coincides with best responses to beliefs about opponents, (b) truthful behavior observed in non-strategic communication has limited ability to predict behavior in strategic communication, and (c) other-regarding preferences play a minimal role in influencing communication behavior in our strategic environments. Our findings favor strategic thinking as the primary explanation of overcommunication and caution that truthful preferences documented in non-strategic settings may not readily explain strategic truthful behavior.

Suggested Citation

  • Lafky, Jonathan & Lai, Ernest K. & Lim, Wooyoung, 2022. "Preferences vs. strategic thinking: An investigation of the causes of overcommunication," Games and Economic Behavior, Elsevier, vol. 136(C), pages 92-116.
    • Handle: RePEc:eee:gamebe:v:136:y:2022:i:c:p:92-116
    DOI: 10.1016/j.geb.2022.08.002
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    More about this item

    Keywords

    Strategic communication; Overcommunication; Truthful preferences; Level-k models; Team design; Laboratory experiment;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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