Advanced Search
MyIDEAS: Login to save this paper or follow this series

Job Market Signaling and Screening: An Experimental Comparison

Contents:

Author Info

  • Kübler, Dorothea

    ()
    (WZB - Social Science Research Center Berlin)

  • Müller, Wieland

    ()
    (University of Vienna)

  • Normann, Hans-Theo

    ()
    (Goethe University Frankfurt)

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.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://ftp.iza.org/dp1794.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1794.

as in new window
Length: 42 pages
Date of creation: Oct 2005
Date of revision:
Publication status: published in: Games and Economic Behavior, 2008, 64 (1), 219-236
Handle: RePEc:iza:izadps:dp1794

Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org

Order Information:
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Email:

Related research

Keywords: sorting; job-market signaling; experiments; Bayesian games; job-market screening;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Dufwenberg, Martin & Gneezy, Uri, 1999. "Price Competition and Market Concentration: An experimental Study," Research Papers in Economics, Stockholm University, Department of Economics 1999:4, Stockholm University, Department of Economics.
  2. David J. Cooper & Susan Garvin & John H. Kagel, 1997. "Signalling and Adaptive Learning in an Entry Limit Pricing Game," RAND Journal of Economics, The RAND Corporation, vol. 28(4), pages 662-683, Winter.
  3. David Cooper & John Kagel, 2008. "Learning and transfer in signaling games," Economic Theory, Springer, vol. 34(3), pages 415-439, March.
  4. Brandts, Jordi & Holt, Charles A, 1992. "An Experimental Test of Equilibrium Dominance in Signaling Games," American Economic Review, American Economic Association, vol. 82(5), pages 1350-65, December.
  5. Brandts, Jordi & Holt, Charles A, 1993. "Adjustment Patterns and Equilibrium Selection in Experimental Signaling Games," International Journal of Game Theory, Springer, vol. 22(3), pages 279-302.
  6. Kübler, Dorothea & Müller, Wieland & Normann, Hans-Theo, 2005. "Job Market Signaling and Screening: An Experimental Comparison," IZA Discussion Papers 1794, Institute for the Study of Labor (IZA).
  7. Holt, Charles A, 1985. "An Experimental Test of the Consistent-Conjectures Hypothesis," American Economic Review, American Economic Association, vol. 75(3), pages 314-25, June.
  8. In-Koo Cho & David M. Kreps, 1997. "Signaling Games and Stable Equilibria," Levine's Working Paper Archive 896, David K. Levine.
  9. Cooper, David J., 2008. "Learning in Entry Limit Pricing Games," Handbook of Experimental Economics Results, Elsevier, Elsevier.
  10. Potters, J.J.M. & Winden, F. van, 1995. "Comparative statics of a signaling game: An experimental study," Discussion Paper, Tilburg University, Center for Economic Research 1995-126, Tilburg University, Center for Economic Research.
  11. Mailath George J. & Okuno-Fujiwara Masahiro & Postlewaite Andrew, 1993. "Belief-Based Refinements in Signalling Games," Journal of Economic Theory, Elsevier, vol. 60(2), pages 241-276, August.
  12. John G. Riley, 1976. "Informational Equilibrium," UCLA Economics Working Papers 071, UCLA Department of Economics.
  13. Spence, A Michael, 1973. "Job Market Signaling," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 87(3), pages 355-74, August.
  14. Cadsby, Charles Bram & Frank, Murray & Maksimovic, Vojislav, 1998. "Equilibrium Dominance in Experimental Financial Markets," Review of Financial Studies, Society for Financial Studies, vol. 11(1), pages 189-232.
  15. Cooper, David J & Garvin, Susan & Kagel, John H, 1997. "Adaptive Learning vs. Equilibrium Refinements in an Entry Limit Pricing Game," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 107(442), pages 553-75, May.
  16. Miller, Ross M & Plott, Charles R, 1985. "Product Quality Signaling in Experimental Markets," Econometrica, Econometric Society, Econometric Society, vol. 53(4), pages 837-72, July.
  17. Kübler, D. & Müller, W., 2002. "Simultaneous and sequential price competition on heterogeneous duopoly markets: Experimental evidence," Open Access publications from Tilburg University urn:nbn:nl:ui:12-112518, Tilburg University.
  18. Cho, In-Koo & Sobel, Joel, 1990. "Strategic stability and uniqueness in signaling games," Journal of Economic Theory, Elsevier, vol. 50(2), pages 381-413, April.
  19. Gary Charness & Matthew Rabin, 2002. "Understanding Social Preferences With Simple Tests," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 117(3), pages 817-869, August.
  20. Paul Milgrom & John Roberts, 1998. "Limit Pricing and Entry Under Incomplete Information: An Equilibrium Analysis," Levine's Working Paper Archive 245, David K. Levine.
  21. Banks, Jeffrey S. & Sobel, Joel., 1985. "Equilibrium Selection in Signaling Games," Working Papers, California Institute of Technology, Division of the Humanities and Social Sciences 565, California Institute of Technology, Division of the Humanities and Social Sciences.
  22. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  23. Martin, Stephen & Normann, Hans-Theo & Snyder, Christopher M, 2001. "Vertical Foreclosure in Experimental Markets," RAND Journal of Economics, The RAND Corporation, vol. 32(3), pages 466-96, Autumn.
  24. Randolph Sloof & Hessel Oosterbeek & Joep Sonnemans, 2007. "Does Making Specific Investments Unobservable Boost Investment Incentives?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 16(4), pages 911-942, December.
  25. Lisa L. Posey & Abdullah Yavas, 2007. "Screening equilibria in experimental markets," The Geneva Risk and Insurance Review, Palgrave Macmillan, vol. 32(2), pages 147-167, December.
  26. Cadsby, Charles B & Frank, Murray & Maksimovic, Vojislav, 1990. "Pooling, Separating, and Semiseparating Equilibria in Financial Markets: Some Experimental Evidence," Review of Financial Studies, Society for Financial Studies, vol. 3(3), pages 315-42.
  27. Cooper, David J. & Kagel, John H., 2003. "The impact of meaningful context on strategic play in signaling games," Journal of Economic Behavior & Organization, Elsevier, vol. 50(3), pages 311-337, March.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Kübler, D. & Müller, W. & Normann, H.T., 2003. "Job Market Signalling and Screening: An Experimental Comparison," Discussion Paper, Tilburg University, Center for Economic Research 2003-124, Tilburg University, Center for Economic Research.
  2. Lisa Posey & Abdullah Yavas, 2007. "Screening equilibria in experimental markets," The Geneva Papers on Risk and Insurance Theory, Springer, Springer, vol. 32(2), pages 147-167, December.
  3. Koch, Alexander K. & Morgenstern, Albrecht & Raab, Philippe, 2009. "Career concerns incentives: An experimental test," Journal of Economic Behavior & Organization, Elsevier, vol. 72(1), pages 571-588, October.
  4. Jeitschko, Thomas D. & Normann, Hans-Theo, 2011. "Signaling in deterministic and stochastic settings," DICE Discussion Papers 35, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
  5. Benndorf, Volker & Kübler, Dorothea & Normann, Hans-Theo, 2013. "Privacy concerns, voluntary disclosure of information, and unraveling: An experiment," Discussion Papers, Research Unit: Market Behavior SP II 2013-208, Social Science Research Center Berlin (WZB).
  6. Alexander K. Koch & Albrecht Morgenstern & Philippe Raab, 2004. "An experimental test of career concerns," Bonn Econ Discussion Papers, University of Bonn, Germany bgse20_2004, University of Bonn, Germany.
  7. Friedrich Poeschel, 2013. "Assortative matching through signals," 2013 Papers, Job Market Papers ppo178, Job Market Papers.
  8. Andrei Bremzeny & Elena Khokhlovaz & Anton Suvorov & Jeroen van de Ven, 2011. "Bad News: An Experimental Study on the Informational Effects of Rewards," Working Papers w0164, Center for Economic and Financial Research (CEFIR).
  9. Hornig, Stephan O. & Rottmann, Horst & Wapler, Rüdiger, 2011. "Sorting on the labour market: A literature overview and theoretical framework," OTH im Dialog: Weidener Diskussionspapiere 27, University of Applied Sciences Amberg-Weiden (OTH).
  10. Kübler, D. & Müller, W. & Normann, H.T., 2008. "Job-market signalling and screening: An experimental study," Open Access publications from Tilburg University urn:nbn:nl:ui:12-347328, Tilburg University.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp1794. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.