Costless statements can still coordinate behaviour when interests partly align, but cannot convey information when they conflict.
Crawford and Sobel showed in 1982 that when interests align, mere assertion coordinates; when they conflict, only costly signals carry information. It explains why "we're committed to quality" conveys nothing.
In practice
- Two teams whose bonuses depend on the same launch date can coordinate by saying "we'll be ready Thursday" and be believed.
- A supplier saying "we're confident about capacity" during a price negotiation conveys nothing, because they would say it either way.
- Standing
- The formal counterpart to costly signalling.
- Further reading
- Wikipedia
- Subject
- Games & Strategic Interaction
- Essay
- The recurring shapes of conflict and cooperation