Job Market Signaling and Screening: An Experimental Comparison

Dorothea Kübler, Wieland Müller and Hans-Theo Normann

No 1794, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We analyze the Spence education game in experimental markets. We compare a signaling and a screening variant, and we analyze the effect of increasing the number of competing employers from two to three. In all treatments, more efficient workers invest more often in education and employers offer higher wages for workers who have invested. However, separation is incomplete, e.g., investment does not pay on average for efficient worker types. Increased competition leads to higher wages in the signaling sessions, not with screening. In the signaling version, we observe significantly more separating outcomes than in the screening version of the game.

Keywords: sorting; job-market signaling; experiments; Bayesian games; job-market screening (search for similar items in EconPapers)
JEL-codes: C35 I2 J24 P3 P52 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2005-10
New Economics Papers: this item is included in nep-edu and nep-exp
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Citations: View citations in EconPapers (5)

Published - published in: Games and Economic Behavior, 2008, 64 (1), 219-236

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Related works:
Journal Article: Job-market signaling and screening: An experimental comparison (2008)
Working Paper: Job-market signalling and screening: An experimental comparison (2008)
Working Paper: Job market signaling and screening: An experimental comparison (2004)
Working Paper: Job Market Signalling and Screening: An Experimental Comparison (2003)
Working Paper: Job Market Signalling and Screening: An Experimental Comparison (2003)
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