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Pragmatics is a subfield of linguistics which studies the ways in which context contributes to meaning. Pragmatics encompasses speech act theory, conversational implicature, talk in interaction and other approaches to language behavior in philosophy, sociology, and linguistics. It studies how the transmission of meaning depends not only on the linguistic knowledge (e.g. grammar, lexicon etc.) of the speaker and listener, but also on the context of the utterance, knowledge about the status of those involved, the inferred intent of the speaker, and so on. In this respect, pragmatics explains how language users are able to overcome apparent ambiguity, since meaning relies on the manner, place, time etc. of an utterance. The ability to understand another speaker's intended meaning is called pragmatic competence. An utterance describing pragmatic function is described as metapragmatic. Pragmatic awareness is regarded as one of the most challenging aspects of language learning, and comes only through experience.
The sentence "You have a green light" is ambiguous. Without knowing the context, the identity of the speaker, and their intent, it is not possible to infer the meaning with confidence. For example:
Similarly, the sentence "Sherlock saw the man with binoculars" could mean that Sherlock observed the man by using binoculars; or it could mean that Sherlock observed a man who was holding binoculars. The meaning of the sentence depends on an understanding of the context and the speaker's intent. As defined in linguistics, a sentence is an abstract entity — a string of words divorced from non-linguistic context — as opposed to an utterance, which is a concrete example of a speech act in a specific context. The closer conscious subjects stick to common words, idioms, phrasings, and topics, the more easily others can surmise their meaning; the further they stray from common expressions and topics, the wider the variations in interpretations. This suggests that sentences don't have meaning intrinsically; there is not a meaning associated with a sentence or word, they can only symbolically represent an idea. The cat sat on the mat is a sentence of English; if you say to your sister on Tuesday afternoon: "The cat sat on the mat", this is an example of an utterance. Thus, there is no such thing as a sentence, term, expression or word symbolically representing a single true meaning; it is underspecified (which cat sat on which mat?) and potentially ambiguous. The meaning of an utterance, on the other hand, is inferred based on linguistic knowledge and knowledge of the non-linguistic context of the utterance (which may or may not be sufficient to resolve ambiguity).
Pragmatics was a reaction to structuralist linguistics as outlined by Ferdinand de Saussure. In many cases, it expanded upon his idea that language has an analyzable structure, composed of parts that can be defined in relation to others. Pragmatics first engaged only in synchronic study, as opposed to examining the historical development of language. However, it rejected the notion that all meaning comes from signs existing purely in the abstract space of langue. Meanwhile, historical pragmatics has also come into being.
When we speak of the referential uses of language we are talking about how we use signs to refer to certain items. Below is an explanation of, first, what a sign is, second, how meanings are accomplished through its usage.
A sign is the link or relationship between a signified and the signifier as defined by Saussure and Huguenin. The signified is some entity or concept in the world. The signifier represents the signified. An example would be:
Signified: the concept cat
Signifier: the word 'cat'"
The relationship between the two gives the sign meaning. This relationship can be further explained by considering what we mean by "meaning." In pragmatics, there are two different types of meaning to consider: semantico-referential meaning and indexical meaning. Semantico-referential meaning refers to the aspect of meaning, which describes events in the world that are independent of the circumstance they are uttered in. An example would be propositions such as:
"Santa Claus eats cookies."
In this case, the proposition is describing that Santa Claus eats cookies. The meaning of this proposition does not rely on whether or not Santa Claus is eating cookies at the time of its utterance. Santa Claus could be eating cookies at any time and the meaning of the proposition would remain the same. The meaning is simply describing something that is the case in the world. In contrast, the proposition, "Santa Claus is eating a cookie right now," describes events that are happening at the time the proposition is uttered.
Semantico-referential meaning is also present in meta-semantical statements such as:
Tiger: omnivorous, a mammal
If someone were to say that a tiger is an omnivorous animal in one context and a mammal in another, the definition of tiger would still be the same. The meaning of the sign tiger is describing some animal in the world, which does not change in either circumstance.
Indexical meaning, on the other hand, is dependent on the context of the utterance and has rules of use. By rules of use, it is meant that indexicals can tell you when they are used, but not what they actually mean.
Whom "I" refers to depends on the context and the person uttering it.
As mentioned, these meanings are brought about through the relationship between the signified and the signifier. One way to define the relationship is by placing signs in two categories: referential indexical signs, also called "shifters," and pure indexical signs.
Referential indexical signs are signs where the meaning shifts depending on the context hence the nickname "shifters." 'I' would be considered a referential indexical sign. The referential aspect of its meaning would be '1st person singular' while the indexical aspect would be the person who is speaking (refer above for definitions of semantico-referential and indexical meaning). Another example would be:
Referential: singular count
Indexical: Close by
A pure indexical sign does not contribute to the meaning of the propositions at all. It is an example of a ""non-referential use of language.""
A second way to define the signified and signifier relationship is C.S. Peirce's Peircean Trichotomy. The components of the trichotomy are the following:
1. Icon: the signified resembles the signifier (signified: a dog's barking noise, signifier: bow-wow)
2. Index: the signified and signifier are linked by proximity or the signifier has meaning only because it is pointing to the signified
3. Symbol: the signified and signifier are arbitrarily linked (signified: a cat, signifier: the word cat)
These relationships allow us to use signs to convey what we want to say. If two people were in a room and one of them wanted to refer to a characteristic of a chair in the room he would say "this chair has four legs" instead of "a chair has four legs." The former relies on context (indexical and referential meaning) by referring to a chair specifically in the room at that moment while the latter is independent of the context (semantico-referential meaning), meaning the concept chair.
Michael Silverstein has argued that "nonreferential" or "pure" indexes do not contribute to an utterance's referential meaning but instead "signal some particular value of one or more contextual variables." Although nonreferential indexes are devoid of semantico-referential meaning, they do encode "pragmatic" meaning.
The sorts of contexts that such indexes can mark are varied. Examples include:
In all of these cases, the semantico-referential meaning of the utterances is unchanged from that of the other possible (but often impermissible) forms, but the pragmatic meaning is vastly different.
J.L. Austin introduced the concept of the Performative, contrasted in his writing with "constative" (i.e. descriptive) utterances. According to Austin's original formulation, a performative is a type of utterance characterized by two distinctive features:
However, a performative utterance must also conform to a set of felicity conditions.
Roman Jakobson, expanding on the work of Karl Bühler, described six "constitutive factors" of a speech event, each of which represents the privileging of a corresponding function, and only one of which is the referential (which corresponds to the context of the speech event). The six constitutive factors and their corresponding functions are diagrammed below.
The Six Constitutive Factors of a Speech Event
The Six Functions of Language
There is considerable overlap between pragmatics and sociolinguistics, since both share an interest in linguistic meaning as determined by usage in a speech community. However, sociolinguists tend to be more interested in variations in language within such communities.
Pragmatics helps anthropologists relate elements of language to broader social phenomena; it thus pervades the field of linguistic anthropology. Because pragmatics describes generally the forces in play for a given utterance, it includes the study of power, gender, race, identity, and their interactions with individual speech acts. For example, the study of code switching directly relates to pragmatics, since a switch in code effects a shift in pragmatic force.
According to Charles W. Morris, pragmatics tries to understand the relationship between signs and their users, while semantics tends to focus on the actual objects or ideas to which a word refers, and syntax (or "syntactics") examines relationships among signs or symbols. Semantics is the literal meaning of an idea whereas pragmatics is the implied meaning of the given idea.
Speech Act Theory, pioneered by J.L. Austin and further developed by John Searle, centers around the idea of the performative, a type of utterance that performs the very action it describes. Speech Act Theory's examination of Illocutionary Acts has many of the same goals as pragmatics, as outlined above.
Pragmatics (more specifically, Speech Act Theory's notion of the performative) underpins Judith Butler's theory of gender performativity. In Gender Trouble, she claims that gender and sex are not natural categories, but socially constructed roles produced by "reiterative acting."
In Excitable Speech she extends her theory of performativity to hate speech and censorship, arguing that censorship necessarily strengthens any discourse it tries to suppress and therefore, since the state has sole power to define hate speech legally, it is the state that makes hate speech performative.
Gilles Deleuze and Félix Guattari discuss linguistic pragmatics in the fourth chapter of A Thousand Plateaus ("November 20, 1923--Postulates of Linguistics"). They draw three conclusions from Austin: (1) A performative utterance doesn't communicate information about an act second-hand—it is the act; (2) Every aspect of language ("semantics, syntactics, or even phonematics") functionally interacts with pragmatics; (3) There is no distinction between language and speech. This last conclusion attempts to refute Saussure's division between langue and parole and Chomsky's distinction between surface structure and deep structure simultaneously. 
Pragmatics is the study of how language is used socially.
For a broader context, see semiotics. Semiotics is a general theory of language. Pragmatics one of its three parts.