Your browser does not fully support modern features. Please upgrade for a smoother experience.
Submitted Successfully!
Thank you for your contribution! You can also upload a video entry or images related to this topic. For video creation, please contact our Academic Video Service.
Version Summary Created by Modification Content Size Created at Operation
1 handwiki Vivi Li -- 4028 2022-11-21 01:45:38

Video Upload Options

We provide professional Academic Video Service to translate complex research into visually appealing presentations. Would you like to try it?
No, upload directly Yes
Cite
If you have any further questions, please contact Encyclopedia Editorial Office.
HandWiki. Signalling (Economics). Encyclopedia. Available online: https://encyclopedia.pub/entry/35358 (accessed on 20 September 2026).
HandWiki. Signalling (Economics). Encyclopedia. Available at: https://encyclopedia.pub/entry/35358. Accessed September 20, 2026.
HandWiki. "Signalling (Economics)" Encyclopedia, https://encyclopedia.pub/entry/35358 (accessed September 20, 2026).
HandWiki. (2022, November 21). Signalling (Economics). In Encyclopedia. https://encyclopedia.pub/entry/35358
HandWiki. "Signalling (Economics)." Encyclopedia. Web. 21 November, 2022.
Signalling (Economics)
Edit
The content is sourced from: https://handwiki.org/wiki/Finance:Signalling_(economics)

In contract theory, signalling (or signaling; see spelling differences) is the idea that one party (the agent) credibly conveys some information about itself to another party (the principal). Although signalling theory was initially developed by Michael Spence based on observed knowledge gaps between organisations and prospective employees, its intuitive nature led it to be adapted to many other domains, such as Human Resource Management, business, and financial markets. In Spence's job-market signaling model, (potential) employees send a signal about their ability level to the employer by acquiring education credentials. The informational value of the credential comes from the fact that the employer believes the credential is positively correlated with having the greater ability and difficulty for low ability employees to obtain. Thus the credential enables the employer to reliably distinguish low ability workers from high ability workers. The concept of signaling is also applicable in competitive altruistic interaction, where the capacity of the receiving party is limited.

informational value signalling theory signalling

References

  1. Michael Spence (1973). "Job Market Signaling". Quarterly Journal of Economics 87 (3): 355–374. doi:10.2307/1882010.  https://dx.doi.org/10.2307%2F1882010
  2. Hungerford, Thomas; Solon, Gary (1987). "Sheepskin Effects in the Returns to Education". Review of Economics and Statistics 69 (1): 175–177. doi:10.2307/1937919.  https://dx.doi.org/10.2307%2F1937919
  3. http://economics.mit.edu/files/552
  4. Waldfogel, Joel; Chen, L (2006). "Does Information Undermine Brand? Information Intermediary Use and Preference for Branded Web Retailers". Journal of Industrial Economics 54 (4): 425–449. doi:10.1111/j.1467-6451.2006.00295.x.  https://dx.doi.org/10.1111%2Fj.1467-6451.2006.00295.x
  5. Waldfogel and Chen (2006), p 429.
  6. Waldfogel and Chen (2006), p 427.
  7. Waldfogel and Chen (2006), p. 448.
  8. Waldfogel and Chen (2006), p. 447.
  9. Waldfogel and Chen (2006), p. 448.
  10. Waldfogel and Chen (2006), p .427.
  11. Mokos, Judit; Scheuring, Istvan (2019). "Altruism, costly signaling, and withholding information in a sport charity campaign". Evolution, Mind and Behaviour 17: 10. https://akjournals.com/view/journals/2050/17/1/article-p10.xml. 
  12. Mokos and Scheuring, (2019), p.10.
  13. Mokos and Scheuring, (2019), p.10.
  14. Cartwright, Edward (2018). Behavioural Economics (Third ed.). London: Routledge. pp. 357. 
  15. Cartwright (2018), p.357-358.
  16. Cartwright (2018), p.357.
  17. Cartwright (2018), p.357.
  18. Cartwright (2018), p.358.
  19. Cartwright (2018), p.358.
  20. Cartwright (2018), p.358.
  21. Mokos and Scheuring, (2019), p.13.
  22. Mokos and Scheuring, (2019), p.13.
  23. Mokos and Scheuring, (2019), p.13.
  24. Mokos and Scheuring, (2019), p.14.
  25. Mokos and Scheuring, (2019), p.14.
  26. Mokos and Scheuring, (2019), p.14.
  27. Mokos and Scheuring, (2019), p.15.
  28. Mokos and Scheuring, (2019), p.15.
  29. Akerlof, G. A. (1970). The market for" lemons": Quality uncertainty and the market mechanism. The Quarterly Journal of Economics, 488-500.
  30. Lewis, Gregory (2011). "Asymmetric Information, Adverse Selection and Online Disclosure: The Case of eBay Motors". American Economic Review 101 (4): 1535–1546. doi:10.1257/aer.101.4.1535.  https://dx.doi.org/10.1257%2Faer.101.4.1535
  31. Dimoka, Angelika; Hong, Yili; Pavlou, Paul (2012). "On Product Uncertainty in Online Markets: Theory and Evidence". MIS Quarterly 36 (2): 395–426. doi:10.2307/41703461.  https://dx.doi.org/10.2307%2F41703461
  32. Rustam Tagiew; Dmitry I. Ignatov; Radhakrishnan Delhibabu (2015). "Economics of Internet-Based Hospitality Exchange". (IEEE/WIC/ACM) International Conference on Web Intelligence and Intelligent Agent Technology (WI-IAT). Singapore. pp. 493–498. doi:10.1109/WI-IAT.2015.89.  https://dx.doi.org/10.1109%2FWI-IAT.2015.89
  33. Fudenberg, Drew; Tirole, Jean (1991). Game Theory. MIT Press. 
  34. Goldlücke, Susanne; Schmitz, Patrick W. (2014). "Investments as signals of outside options". Journal of Economic Theory 150: 683–708. doi:10.1016/j.jet.2013.12.001.  https://dx.doi.org/10.1016%2Fj.jet.2013.12.001
  35. Gartzke, Erik; Carcelli, Shannon; Gannon, J Andres; Zhang, Jiakun Jack (August 2017). "Signaling in Foreign Policy". Oxford Research Encyclopedia of Politics: 30. https://static1.squarespace.com/static/55eef123e4b087ad372e72cf/t/5630f611e4b0928851544bb5/1446049297918/prosocial.pdf. 
  36. Yarhi-Milo, Keren; Kertzer, Joshua D; Renshon, Jonathon (2018). "Tying Hands, Sinking Costs and Leader Attributes". Journal of Conflict Resolution 62 (10): 2150–2179. doi:10.1177/0022002718785693. https://scholar.princeton.edu/sites/default/files/kyarhi/files/jcr_piece.pdf. 
  37. Quek, Kai (19 January 2021). "Four Costly Signaling Mechanisms". American Political Science Review 115 (2): 537–549. doi:10.1017/S0003055420001094. https://www.cambridge.org/core/journals/american-political-science-review/article/four-costly-signaling-mechanisms/F05A439BE1F78751453A65CADFBDB071. 
More
©Text is available under the terms and conditions of the Creative Commons-Attribution ShareAlike (CC BY-SA) license; additional terms may apply. By using this site, you agree to the Terms and Conditions and Privacy Policy.
Upload a video for this entry
Information
Subjects: Others
Contributor MDPI registered users' name will be linked to their SciProfiles pages. To register with us, please refer to https://encyclopedia.pub/register :
HandWiki
View Times: 3.2K
Entry Collection: HandWiki
Revision: 1 time (View History)
Update Date: 21 Nov 2022
Table of Contents
    Notice
    You are not a member of the advisory board for this topic. If you want to update advisory board member profile, please contact office@encyclopedia.pub.
    OK
    Confirm
    Only members of the Encyclopedia advisory board for this topic are allowed to note entries. Would you like to become an advisory board member of the Encyclopedia?
    Yes
    No
    ${ textCharacter }/${ maxCharacter }
    Submit
    Cancel
    There is no comment~
    ${ textCharacter }/${ maxCharacter }
    Submit
    Cancel
    ${ selectedItem.replyTextCharacter }/${ selectedItem.replyMaxCharacter }
    Submit
    Cancel
    Confirm
    Are you sure to Delete?
    Yes No
    Academic Video Service
    Feedback