A Theory of Types of Conflict in Strategic Communication

We study communication in coordination games with either conflicting preferences or conflicting beliefs. We show these two ways of modeling conflict lead to drastically different conclusions. While for any type of conflict truthful communication is always beneficial from the ex-ante perspective, there is however a credibility issue at the interim stage, i.e., information transmission pattern crucially depends on the nature of disagreement. Under conflicting preferences information transmission exhibits a negative externality effect: greater information obtained by some agent discourages further information accumulation by harming the credibility of other agents. In contrast, under conflicting beliefs information transmission exhibits a positive externality effect: greater information obtained by some agent encourages further information accumulation by improving the credibility of other agents. By applying our findings to several frameworks, we show how strategic motives, depending on the types of conflict, crucially affect information aggregation in polls and policy outcomes, direction of information flow in communities, communication network formations, and segregations and aggregations in communications due to adding new information. Our result highlights the importance of taking into account the types of conflict between individuals in strategic communication models.