Friday, September 2, 2011

Signaling in Internet Dating Markets (and welcoming Soo Lee to Harvard)

 Soohyung Lee arrived today at Harvard where she'll spend the coming academic year as a research visitor, on leave from the University of Maryland. (She'll be sitting in Baker Library, come by and join us for coffee some morning and say hello.)

Here's a recent paper that I admire:
Propose with a Rose? Signaling in Internet Dating Markets, (ungated version here)
by Soohyung Lee, Muriel Niederle, Hye-Rim Kim, Woo-Keum Kim
NBER Working Paper No. 17340
August 2011

"Abstract: The large literature on costly signaling and the somewhat scant literature on preference signaling had varying success in showing the effectiveness of signals. We use a field experiment to show that even when everyone can send a signal, signals are free and the only costs are opportunity costs, sending a signal increases the chances of success. In an online dating experiment, participants can attach “virtual roses” to a proposal to signal special interest in another participant. We find that attaching a rose to an offer substantially increases the chance of acceptance. This effect is driven by an increase in the acceptance rate when the offer is made to a participant who is less desirable than the proposer. Furthermore, participants endowed with more roses have more of their offers accepted than their counterparts."

One of the things I like about this paper (aside from the fact that it reports an experiment in market design, that is), is that it also sheds some light on the signaling mechanism for new Ph.D.s on the economics job market.

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