Thursday, June 30, 2011

Signaling – Why is college important?

Getting a College Degree is Important Because: Signaling

The All-seeing eyes of
a peacock feather.
able to see Past, Present and Future 
A friend of mine relayed a story from Visa International. 
They posted a job requisition for a single position and had 600 applicants. Screening the pool reduced the count to 60, which were further sifted and sorted before the first interview took place. What will your resume signal to your future employers?
Michael Spence originally proposed the idea of signaling - that in a situation with information asymmetry [incomplete information], it is possible for people to signal their type, thus believably transferring information to the other party and resolving the asymmetry.”
“Spence proposes, for example, that going to college can function as a credible signal of an ability to learn. Assuming that people who are skilled in learning can finish college more easily than people who are unskilled, then by finishing college the skilled people signal their skill to prospective employers. 

No matter how much or how little they may have learned in college, finishing functions as a signal of their capacity for learning. However, finishing college may merely function as a signal of their ability to pay for college, it may signal the willingness of individuals to adhere to orthodox views, or it may signal a willingness to comply with authority.”

Que sais-je?


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