IDEAS home Printed from https://ideas.repec.org/p/dpr/wpaper/1216.html
   My bibliography  Save this paper

Pecuniary Emulation and Invidious Distinction: Signaling under Behavioral Diversity

Author

Listed:
  • Junichiro Ishida
  • Wing Suen

Abstract

We introduce behavioral diversity to an otherwise standard signaling model, in which a fraction of agents choose their signaling actions according to an exogenous distribution. These behavioral agents provide opportunities for strategic low-type agents to successfully emulate higher types in equilibrium, which in turn reduces the cost for strategic high-type agents to separate from lower types. Behavioral diversity thus improves the equilibrium payoffs to all types of strategic agents. The model also exhibits a convergence property which is intuitively more appealing than the least-cost separating equilibrium of the standard setting.

Suggested Citation

  • Junichiro Ishida & Wing Suen, 2023. "Pecuniary Emulation and Invidious Distinction: Signaling under Behavioral Diversity," ISER Discussion Paper 1216, Institute of Social and Economic Research, Osaka University.
  • Handle: RePEc:dpr:wpaper:1216
    as

    Download full text from publisher

    File URL: https://www.iser.osaka-u.ac.jp/library/dp/2023/DP1216.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. 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.
    2. Heidrun C. Hoppe & Benny Moldovanu & Aner Sela, 2009. "The Theory of Assortative Matching Based on Costly Signals," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 76(1), pages 253-281.
    3. Francesc Dilmé & Fei Li, 2016. "Dynamic Signaling with Dropout Risk," American Economic Journal: Microeconomics, American Economic Association, vol. 8(1), pages 57-82, February.
    4. Nick Feltovich & Richmond Harbaugh & Ted To, 2002. "Too Cool for School? Signalling and Countersignalling," RAND Journal of Economics, The RAND Corporation, vol. 33(4), pages 630-649, Winter.
    5. Jeitschko, Thomas D. & Normann, Hans-Theo, 2012. "Signaling in deterministic and stochastic settings," Journal of Economic Behavior & Organization, Elsevier, vol. 82(1), pages 39-55.
    6. Ian Ball, 2019. "Scoring Strategic Agents," Papers 1909.01888, arXiv.org, revised May 2024.
    7. Ed Hopkins & Tatiana Kornienko, 2004. "Running to Keep in the Same Place: Consumer Choice as a Game of Status," American Economic Review, American Economic Association, vol. 94(4), pages 1085-1107, September.
    8. In-Koo Cho & David M. Kreps, 1987. "Signaling Games and Stable Equilibria," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 102(2), pages 179-221.
    9. Chen, Chia-Hui & Ishida, Junichiro & Suen, Wing, 2024. "Signaling under double-crossing preferences: The case of discrete types," Journal of Mathematical Economics, Elsevier, vol. 114(C).
    10. Matthews, Steven A & Mirman, Leonard J, 1983. "Equilibrium Limit Pricing: The Effects of Private Information and Stochastic Demand," Econometrica, Econometric Society, vol. 51(4), pages 981-996, July.
    11. Alex Frankel & Navin Kartik, 2019. "Muddled Information," Journal of Political Economy, University of Chicago Press, vol. 127(4), pages 1739-1776.
    12. 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.
    13. Sander Heinsalu, 2018. "Dynamic Noisy Signaling," American Economic Journal: Microeconomics, American Economic Association, vol. 10(2), pages 225-249, May.
    14. Heisig, Jan Paul, 2018. "Measuring the signaling value of educational degrees: secondary education systems and the internal homogeneity of educational groups," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 6, pages 1-35.
    15. Aloisio Araujo & Daniel Gottlieb & Humberto Moreira, 2007. "A model of mixed signals with applications to countersignalling," RAND Journal of Economics, RAND Corporation, vol. 38(4), pages 1020-1043, December.
    16. de Haan, Thomas & Offerman, Theo & Sloof, Randolph, 2011. "Noisy signaling: Theory and experiment," Games and Economic Behavior, Elsevier, vol. 73(2), pages 402-428.
    17. Daley, Brendan & Green, Brett, 2014. "Market signaling with grades," Journal of Economic Theory, Elsevier, vol. 151(C), pages 114-145.
    18. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(3), pages 355-374.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ekmekci, Mehmet & Kos, Nenad, 2023. "Signaling covertly acquired information," Journal of Economic Theory, Elsevier, vol. 214(C).
    2. Ennio Bilancini & Leonardo Boncinelli, 2014. "Small Noise in Signaling Selects Pooling on Minimum Signal," Center for Economic Research (RECent) 101, University of Modena and Reggio E., Dept. of Economics "Marco Biagi".
    3. Chen, Chia-Hui & Ishida, Junichiro & Suen, Wing, 2024. "Signaling under double-crossing preferences: The case of discrete types," Journal of Mathematical Economics, Elsevier, vol. 114(C).
    4. Jeitschko, Thomas D. & Normann, Hans-Theo, 2012. "Signaling in deterministic and stochastic settings," Journal of Economic Behavior & Organization, Elsevier, vol. 82(1), pages 39-55.
    5. Figueroa, Nicolás & Guadalupi, Carla, 2023. "Signaling through tests," The Quarterly Review of Economics and Finance, Elsevier, vol. 92(C), pages 25-34.
    6. de Haan, Thomas & Offerman, Theo & Sloof, Randolph, 2011. "Noisy signaling: Theory and experiment," Games and Economic Behavior, Elsevier, vol. 73(2), pages 402-428.
    7. Daley, Brendan & Green, Brett, 2014. "Market signaling with grades," Journal of Economic Theory, Elsevier, vol. 151(C), pages 114-145.
    8. Tingting Nian & Arun Sundararajan, 2022. "Social Media Marketing, Quality Signaling, and the Goldilocks Principle," Information Systems Research, INFORMS, vol. 33(2), pages 540-556, June.
    9. Dilmé, Francesc, 2019. "Dynamic quality signaling with hidden actions," Games and Economic Behavior, Elsevier, vol. 113(C), pages 116-136.
    10. Mehmet Ekmekci & Nenad Kos, 2020. "Signaling Covertly Acquired Information," Working Papers 658, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    11. Alós-Ferrer, Carlos & Prat, Julien, 2012. "Job market signaling and employer learning," Journal of Economic Theory, Elsevier, vol. 147(5), pages 1787-1817.
    12. Richard Chisik, 2015. "Job market signalling, stereotype threat and counter‐stereotypical behaviour," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 48(1), pages 155-188, February.
    13. Sadowski, Philipp, 2016. "Overeagerness," Journal of Economic Behavior & Organization, Elsevier, vol. 131(PA), pages 114-125.
    14. Kübler, Dorothea & Müller, Wieland & Normann, Hans-Theo, 2008. "Job-market signaling and screening: An experimental comparison," Games and Economic Behavior, Elsevier, vol. 64(1), pages 219-236, September.
    15. Starkov, Egor, 2023. "Only time will tell: Credible dynamic signaling," Journal of Mathematical Economics, Elsevier, vol. 109(C).
    16. Philipp Denter & John Morgan & Dana Sisak, 2022. "Showing Off or Laying Low? The Economics of Psych-outs," American Economic Journal: Microeconomics, American Economic Association, vol. 14(1), pages 529-580, February.
    17. Tomer Blumkin & Spencer Bastani & Luca Micheletto, 2024. "Rethinking Commodity Taxation: The New StatusRedistribution Channel," Working Papers 2412, Ben-Gurion University of the Negev, Department of Economics.
    18. Soeren Johansen & Anders Rygh Swensen, 2021. "Adjustment coefficients and exact rational expectations in cointegrated vector autoregressive models," Discussion Papers 21-07, University of Copenhagen. Department of Economics.
    19. Liu, Shuo & Pei, Harry, 2020. "Monotone equilibria in signaling games," European Economic Review, Elsevier, vol. 124(C).
    20. Helmut Bester & Matthias Lang & Jianpei Li, 2021. "Signaling versus Auditing," RAND Journal of Economics, RAND Corporation, vol. 52(4), pages 859-883, December.

    More about this item

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:dpr:wpaper:1216. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Librarian (email available below). General contact details of provider: https://edirc.repec.org/data/isosujp.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.