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

See all articles by Aloisio Araujo

Aloisio Araujo

Getulio Vargas Foundation (FGV) - FGV/EPGE Escola Brasileira de Economia e Finanças

Daniel Gottlieb

Massachusetts Institute of Technology (MIT) - Department of Economics

Humberto Moreira

Fundacao Getulio Vargas (FGV)

Date Written: August 13, 2004

Abstract

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

Suggested Citation

Araujo, Aloisio and Gottlieb, Daniel and Moreira, Humberto, A Model of Mixed Signals with Applications to Countersignaling and the GED (August 13, 2004). The RAND Journal of Economics, Vol. 38, No. 4 (Winter, 2007) (pp. 1020-1043) , Available at SSRN: https://ssrn.com/abstract=2330806

Aloisio Araujo (Contact Author)

Getulio Vargas Foundation (FGV) - FGV/EPGE Escola Brasileira de Economia e Finanças ( email )

Praia de Botafogo 190/1125, CEP
Rio de Janeiro RJ 22253-900
Brazil

Daniel Gottlieb

Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

77 Massachusetts Avenue
E52-391
Cambridge, MA 02139-4307
United States

Humberto Moreira

Fundacao Getulio Vargas (FGV) ( email )

R. Dr. Neto de Araujo 320 cj 1307
Rio de Janeiro, Rio de Janeiro 22250-900
Brazil

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