Signalling

aje on January 20, 2020

Reading: Spence, M., 1973, “Job Market Signaling”. Quarterly Journal of Economics 87(3):355–374
Lecture handout: Signalling*

Textbook Reading: Chapter 3 (Section 3.4; pp. 90-96)

Here’s a lecture video providing an example of the model.

Here’s my treatment of signalling and countersignalling:

And here is a great twitter thread on why you should always wear a tie with a formal suit:

In “What toffs and plebs share“, Ed West uses the signalling vs. counter signalling distinction to argue that institutions such as horse racing or the army demonstrate a unity of peasant culture and aristocracy. He identifies a U-curve of social patterns, with those in the middle trying hard to distinguish themselves from those below, even though this reduces their ability to mix with those at the top.

Recommended audio:

Recommended video:

This debate considers the extent to which higher education is merely signalling:

Learning Objectives: Understand the returns to education

Focus on diversity: Claudia Goldin is a world leading labour economist, a former president of the American Economic Association, and co-author of a highly influential book on the earnings gap between high skilled and low skilled workers. She is also a pioneer for studying the role of women in the economy and won the Nobel Prize in 2023. See here for a video profile.