Tuesday, October 8, 2013

The topic for Thursday's class

We will talk about signaling (the person with the private information taking a costly action to communicate what the information is) and inference (what the uninformed party interprets from the signal).  There will not be a PowerPoint for this.  But if you have read the book Moneyball (or even if you have just seen the movie) that might be good preparation.

http://www.econ.yale.edu/~dirkb/teach/pdf/spence/1973%20job%20market%20signalling.pdf
1973 job market signalling.pdf via kwout

I will use this piece in our discussion of inference.  It should be relevant to you. 

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