Signaling Theory: A Review and Assessment

  title={Signaling Theory: A Review and Assessment},
  author={Brian L. Connelly and S. Trevis Certo and R. Duane Ireland and Christopher R. Reutzel},
  journal={Journal of Management},
  pages={39 - 67}
Signaling theory is useful for describing behavior when two parties (individuals or organizations) have access to different information. Typically, one party, the sender, must choose whether and how to communicate (or signal) that information, and the other party, the receiver, must choose how to interpret the signal. Accordingly, signaling theory holds a prominent position in a variety of management literatures, including strategic management, entrepreneurship, and human resource management… 

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