We analyze optimal redistribution in the presence of labor market signaling where innate productive ability is not only … unobserved by the government, but also by prospective employers. Signaling in both one and two dimensions is considered, where in …

In Spence's (1973) signaling by education model and in many of its extensions, firms can only infer workers …' productivities. We characterize the trade-offs between signaling by workers and costly information acquisition by firms. Information … workers have low productivity. Our analysis applies also to other signaling problems, e.g. the financial structure of firms …

show that herding behavior plays an important signaling role in reducing opportunity costs if the auction does not receive … and highlight the controversial effects of signaling mechanisms on adverse selection in crowdfunding markets. …

and 30% to education signaling workers' ability. …

acquisition ; inspection ; lemons ; middlemen ; signaling …