is the opposite behaviour of Signaling, as it applies to the behavioural sciences
, in economic
terms, is putting money on the table just to prove that you can. Peacocks
expend energy on elaborate plumage, thus exposing themselves to risk of capture, to prove that they are good mates
. (In biology
, this is known as handicap signaling
Need for signaling
Signaling combats the loss of credibility
caused by cheap talk
. For example when someone gives stock-picking advice
, and they have a vested interest in making you believe stocks they hold are valuable, why would you believe what they say?
, by contrast, is showing off by not showing off, or by playing humble. A mediocre student may exaggerate or brag on a college application, but the best of the best would not stoop so low.
Feltovich, Hargaugh, and To develop a formal model in which receivers of signals judge the senders of signals based not only on what can be inferred from the signal sent, but also on additional information, which is assumed to be helpful but not perfect. For example, senders might be of Low, Medium, or High quality, and the additional information might be adequate for distinguishing Low from High but not necessarily from distinguishing Medium from Low or High. Under certain circumstances, Medium-quality senders will have an incentive to signal (to ensure that they can be distinguished from Low-quality ones), but High-quality senders may not - they are not likely to be mistaken for Low-quality senders in any case, and signaling behavior may mark them as Medium.
- Signaling and Countersignaling – extended abstract by Nick Feltovich, Rick Harbaugh, and Ted To, RAND Journal of Economics, Vol. 33, Winter 2002, 630-649.