A costless signaling mechanism has been proposed as a device to improve welfare in decentralized two-sided matching … information between firms and workers and show that costless signaling is actually harmful in some matching markets. Specifically …, if agents have very similar preferences, signaling lessens the total number of matches and the welfare of firms, as well …

action that can signal their high productivity, and ask whether the possibility of signaling reduces the reliance on the … network. We find that the network is remarkably resilient. To be effective signaling must fulfill two contradictory …