Riley, John G - In: Scandinavian Journal of Economics 104 (2002) 2, pp. 213-36
Akerlof, Spence and Stiglitz showed that competitive markets can perform very poorly in the presence of informational asymmetry. In this paper I show that if there is a signaling technology which is sufficiently strong (i.e., the marginal cost of signaling declines sufficiently rapidly with...