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Description
Using a communiation game between individuals endowed with different languages, this paper experimentally investigate the role of trade benefits in the formation of a common language between the two individuals, under the highly abstract trade context. We find evidence from the laboratory that the agents who benefits more from the trade is more likely to learn/adopt the opponent's language. Interestingly, trade gains also appear to incentivize senders to develop compositional languages that facilitate learning and communication efficiency.