Harmful Signaling in Matching Markets

Alexey Kushnir ()

No 2010.121, Working Papers from Fondazione Eni Enrico Mattei

Abstract: Some labor markets have recently developed formal signalling mechanisms, e.g. the signalling for interviews in the job market for new Ph.D. economists. We evaluate the effect of such mechanisms on two-sided matching markets by considering a game of incomplete information between firms and workers. Workers have almost aligned preferences over firms: each worker has “typical” commonly known preferences with probability close to one and “atypical” idiosyncratic preferences with the complementary probability close to zero. Firms have some commonly known preferences over workers. We show that the introduction of a signalling mechanism is harmful for this environment. Though signals transmit previously unavailable information, they also facilitate information asymmetry that leads to coordination failures. As a result, the introduction of a signalling mechanism lessens the expected number of matches when signals are informative.

Keywords: Signaling; Cheaptalk; Matching (search for similar items in EconPapers)
JEL-codes: C72 C78 D80 J44 (search for similar items in EconPapers)
Date: 2010-10
New Economics Papers: this item is included in nep-cta, nep-gth and nep-lab
References: Add references at CitEc
Citations:

Downloads: (external link)
https://feem-media.s3.eu-central-1.amazonaws.com/w ... oads/ndl2010-121.pdf (application/pdf)

Related works:
Journal Article: Harmful signaling in matching markets (2013)
Working Paper: Harmful Signaling in Matching Markets (2010)
Working Paper: Matching Markets with Signals (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fem:femwpa:2010.121

Access Statistics for this paper

More papers in Working Papers from Fondazione Eni Enrico Mattei Contact information at EDIRC.
Bibliographic data for series maintained by Alberto Prina Cerai ( this e-mail address is bad, please contact ).