Journal ArticleDOI
Job Market Signaling
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In this paper, the authors present a model in which signaling is implicitly defined and explains its usefulness, in which the employer is not sure of the productive capabilities of an individual at the time he/she hires him.Abstract:
Publisher Summary This chapter discusses job market signaling. The term market signaling is not exactly a part of the well-defined, technical vocabulary of the economist. The chapter presents a model in which signaling is implicitly defined and explains its usefulness. In most job markets, the employer is not sure of the productive capabilities of an individual at the time he hires him. The fact that it takes time to learn an individual's productive capabilities means that hiring is an investment decision. On the basis of previous experience in the market, the employer has conditional probability assessments over productive capacity with various combinations of signals and indices. This chapter presents an introduction to Spence's more extensive analysis of market signaling.read more
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Informational asymmetries, financial structure, and financial intermediation
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ReportDOI
Rank-Order Tournaments as Optimum Labor Contracts
Edward P. Lazear,Sherwin Rosen +1 more
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Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information
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Journal ArticleDOI
The Role of Market Forces in Assuring Contractual Performance
Benjamin Klein,Keith B. Leffler +1 more
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Journal ArticleDOI
Dividend Policy under Asymmetric Information
Merton H. Miller,Kevin Rock +1 more
TL;DR: In this article, the authors extend the standard finance model of the firm's dividend/investment/financing decisions by allowing the managers to know more than outside investors about the true state of the current earnings.
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