Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/168013 
Year of Publication: 
2017
Citation: 
[Journal:] Games [ISSN:] 2073-4336 [Volume:] 8 [Issue:] 1 [Publisher:] MDPI [Place:] Basel [Year:] 2017 [Pages:] 1-21
Publisher: 
MDPI, Basel
Abstract: 
Might the resource costliness of making signals credible be low or negligible? Using a job market as an example, we build a signaling model to determine the extent to which a transfer from an applicant might replace a resource cost as an equilibrium method of achieving signal credibility. Should a firm's announcement of hiring for an open position be believed, the firm has an incentive to use a properly-calibrated fee to implement a separating equilibrium. The result is robust to institutional changes, outside options, many firms or many applicants and applicant risk aversion, though a sufficiently risk-averse applicant who is sufficiently likely to be a high type may lead to a preference for a pooling equilibrium.
Subjects: 
costly signaling
social cost of signaling
asymmetric information
separating equilibrium
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Appears in Collections:

Files in This Item:
File
Size
409.09 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.