Incomplete Disclosure: Evidence of Signaling and Countersignaling

B-Tier
Journal: American Economic Journal: Microeconomics
Year: 2018
Volume: 10
Issue: 1
Pages: 41-66

Authors (5)

Benjamin B. Bederson (not in RePEc) Ginger Zhe Jin (not in RePEc) Phillip Leslie (not in RePEc) Alexander J. Quinn (not in RePEc) Ben Zou (Purdue University)

Score contribution per author:

0.402 = (α=2.01 / 5 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

In 2011, Maricopa County adopted voluntary restaurant hygiene grade cards (A, B, C, D). Using inspection results between 2007 and 2013, we show that only 58 percent of the subsequent inspections led to online grade posting. Although the disclosure rate in general declines with inspection outcome, higher-quality A restaurants are less likely to disclose than lower-quality As. After examining potential explanations, we believe the observed pattern is best explained by a mixture of signaling and countersignaling: the better A restaurants use nondisclosure as a countersignal, while worse As and better Bs use disclosure to stand out from the other restaurants.

Technical Details

RePEc Handle
repec:aea:aejmic:v:10:y:2018:i:1:p:41-66
Journal Field
General
Author Count
5
Added to Database
2026-01-29