This paper develops a multi-period model, in which workers are matched with jobs according to imperfect educational signals and in which their subsequent productivities depend on both their inherent ability and on the quality of the job match. It outlines a sequential process, in which underpaid...

This paper extends the job market signaling model of Spence (1973) by allowing firms to learn the ability of their employees over time. Contrary to the model without employer learning, we find that the Intuitive Criterion does not always select a unique separating equilibrium. When the Intuitive...

We propose a signaling model of student enrollment dynamics based on probabilities of completion of studies, under different rationality assumptions. There are two types of students and two schools. School of graduation serves as a signal of student productivity to prospective employers. The...

Letter grades are noisy and coarse measures of academic achievement. However, these grades serve as important signals to both employers and to the student on his or her ability. I study the consequences of these noisy measures using administrative data from the National University of Singapore...

The paper discusses the impact of ability grouping in secondary education on student incentives. Education provides a signal on unobservable ability for employers and improves productivity after education. Selection sets better incentives in primary education and allows for improved peer group...