Signaling—actions or credentials that are costly to obtain and negatively correlated with underlying quality characteristics that buyers want to know—helps close information gaps; examples include graduating from prestigious institutions (MIT, Stanford), executive dividend cuts, and management stock purchases.
definitionpending
Speaker
Michael SpenceEvidence Quote
“there are activities that people can undertake that have differential costs with respect to with you know that are negatively correlated with the underlying quality uh characteristics that buyers want to know and those signals turn out to be pretty important”
Source
Nobel Prize-Winning Economist Sees Era Of "Permacrisis" Ahead | Michael Spence (w/ Adam Taggart)— Adam Taggart | Thoughtful Money®Created: 8/11/2026, 1:51:12 AM
My Notes
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