A Model of Mixed Signals with Applications to Countersignaling and the GED
The RAND Journal of Economics, Vol. 38, No. 4 (Winter, 2007) (pp. 1020-1043)
35 Pages Posted: 30 Sep 2013
Date Written: August 13, 2004
We develop a job-market signalling model where signals convey two pieces of information. This model is employed to study countersignalling (signals nonmonotonic in ability) and the GED exam. A result of the model is that countersignalling is more likely to occur in jobs that require a combination of skills that differs from the combination used in the schooling process. The model also produces testable implications consistent with evidence on the GED: (i) it signals both high cognitive and low noncognitive skills and (ii) it does not affect wages.
Keywords: GED, job-market, noncognitive skills
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