We address the issue of rational communicative behavior among autonomous se
lf-interested agents that have to make decisions as to what to communicate,
to whom, and how. Following decision theory, we postulate that a rational
speaker should design a speech act so as to optimize the benefit it obtains
as the result of the interaction. We quantify the gain in the quality of i
nteraction in terms of the expected utility, and we present a framework tha
t allows an agent to compute the expected utilities of various communicativ
e actions. Our framework uses the Recursive Modeling Method as the speciali
zed representation used for decision-making in a multi-agent environment. T
his representation includes information about the agent's state of knowledg
e, including the agent's preferences, abilities and beliefs about the world
, as well as the beliefs the agent has about the other agents, the beliefs
it has about the other agents' beliefs, and so on. Decision-theoretic pragm
atics of a communicative act can be then defined as the transformation the
act induces on the agent's state of knowledge about its decision-making sit
uation. This transformation leads to a change in the quality of interaction
, expressed in terms of the expected utilities of the agent's best actions
before and after the communicative act. We analyze decision-theoretic pragm
atics of a number of important kinds of communicative acts and investigate
their expected utilities using examples. Finally, we report on the agreemen
t between our method of message selection and messages that human subjects
choose in various circumstances, and show an implementation and experimenta
l validation of our framework in a simulated multi-agent environment.