Are Costly Signals More Credible? Evidence of Sender-Receiver Gaps

39 Pages Posted: 26 Apr 2013 Last revised: 24 May 2016

See all articles by Kai Quek

Kai Quek

The University of Hong Kong

Date Written: April 17, 2013

Abstract

The idea that costly signals are more credible is a long-standing hypothesis in international politics. However, little is known on how costly signaling actually works. Causal evidence is elusive because the effect of a costly signal is almost always confounded with the effects of other previous or simultaneous information. I design three controlled experiments to study how the logic of sinking costs operates. I find that signalers randomly assigned with high resolve are more likely to sink costs, but receivers do not acquiesce in line with signaler expectations, despite the sunk costs suffered. The logic of sunk-cost signaling is strong at the signaler’s end but not at the receiver’s end. There is a sender-receiver gap in how the same deterrence interaction is perceived at the two ends of the signaling mechanism, contrary to what the theory of costly signaling automatically assumes.

Keywords: Signaling, Deterence, Crisis, War, Experiment

Suggested Citation

Quek, Kai, Are Costly Signals More Credible? Evidence of Sender-Receiver Gaps (April 17, 2013). Journal of Politics (2016), MIT Political Science Department Research Paper No. 2013-16, Available at SSRN: https://ssrn.com/abstract=2256528 or http://dx.doi.org/10.2139/ssrn.2256528

Kai Quek (Contact Author)

The University of Hong Kong ( email )

Pokfulam Road
Hong Kong, Pokfulam HK
China

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