For his analyses of market with Asymmetric information
Affiliation at the time of Award
1 He showed how the able agents may improve the market outcome by taking costly action to signal information to poorly informed recipients. An important example is education as a signal of high individual productivity in the labour market. It is not necessary for education to have intrinsic value. Costly investment in education as such signals high ability.
1 Job Market Signalling (1973).
2 Market signalling: Informational transfer in hiring and related screening processes (1974).
3 Leadership and growth (2010).
4 The Next Convergence: The future of economic growth in a multispeed world (2011).