Good signals gone bad: Dynamic signalling with switched effort levels
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This paper examines signalling when the sender exerts effort and receives benefits over time. Receivers only observe a noisy public signal about the effort, which has no intrinsic value. The modelling of signalling in a dynamic context gives rise to novel equilibrium outcomes. In some equilibria, a sender with a higher cost of effort exerts strictly more effort than his low-cost counterpart. The low-cost type can compensate later for initial low effort, but this is not worthwhile for a...[Show more]
dc.contributor.author | Heinsalu, Sander | |
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dc.date.accessioned | 2018-01-16T05:19:42Z | |
dc.identifier.issn | 0304-4068 | |
dc.identifier.uri | http://hdl.handle.net/1885/139362 | |
dc.description.abstract | This paper examines signalling when the sender exerts effort and receives benefits over time. Receivers only observe a noisy public signal about the effort, which has no intrinsic value. The modelling of signalling in a dynamic context gives rise to novel equilibrium outcomes. In some equilibria, a sender with a higher cost of effort exerts strictly more effort than his low-cost counterpart. The low-cost type can compensate later for initial low effort, but this is not worthwhile for a high-cost type. The interpretation of a given signal switches endogenously over time, depending on which type the receivers expect to send it. | |
dc.format.mimetype | application/pdf | |
dc.publisher | Elsevier | |
dc.rights | © 2017 Elsevier B.V. | |
dc.source | Journal of Mathematical Economics | |
dc.title | Good signals gone bad: Dynamic signalling with switched effort levels | |
dc.type | Journal article | |
local.identifier.citationvolume | 73 | |
dc.date.issued | 2017 | |
local.publisher.url | https://www.elsevier.com/ | |
local.type.status | Accepted Version | |
local.contributor.affiliation | Heinsalu, S., Research School of Economics, The Australian National University | |
local.bibliographicCitation.startpage | 132 | |
local.bibliographicCitation.lastpage | 141 | |
local.identifier.doi | 10.1016/j.jmateco.2017.10.001 | |
dcterms.accessRights | Open Access | |
dc.provenance | http://www.sherpa.ac.uk/romeo/issn/0304-4068/..."Author's post-print on open access repository after an embargo period of between 12 months and 48 months" from SHERPA/RoMEO site (as at 12/01/18). | |
Collections | ANU Research Publications |
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