“Dumb” as they may seem, symbolic gestures matter.

Titus would like a word.

The golden rule of spin: if you have nothing good to say, say nothing at all.

Moshe Hoffman and I have used game theory to look into why this might happen. You can find our work in the below paper, and in our Ch. 12 of our book, Hidden Games.

www.researchsquare.com/article/rs-2...

Garber’s got the gift of gab

From today’s Morning Rounds newsletter:

For a while...

So, luxury manufacturers maintain exclusivity by jacking up the price.

They don't need to increase quality. Just jacking up the price is enough.

What if folks get richer? For most producers, that would be great news, since they could just sell their product to more people.

But when it comes to luxury goods, the logic is different, and uglier. If everyone can afford an LV handbag, then no one would want one.

Receivers don't value the signal per se, but they might still attend to it if it reveals useful information.

Namely, if senders who can afford to send the signal are the more desirable ones.

In a costly signaling framework...

- Senders wish to be accepted by receivers (as e.g., friends, coworkers, romantic partners)

- Some senders are more desirable than others, but it's hard to tell them apart

- Senders can send a signal at some cost

Here's the model; from our book Hidden Games.

We do get something for our increased transportation spending — about 10 mins a day in shorter commutes, on average.

cdn.statcdn.com/Infographic/...

Might I recommend Michael Thaler's experiments, which very cleanly demonstrate this? Here is a link and a brief summary.

arxiv.org/pdf/2012.016...

We also tried two different public good frames: one in which the individual was directly contributing to the environment, and one in which the community was working together to contribute to the environment. TLDR: there wasn't a huge difference.

But how do you increase observability in a social media ad?

Our solution: tell them they can "share their progress" (control on the left, observability treatment on the right)

This is a simple paper.

Our task: help our partner use social media ads to enroll people for a peer-to-peer solar program, in which people who can't install solar themselves buy the extra production from a neighbor.

New paper in JEBO: telling people their contributions can be made observable increases participation in a peer-to-peer solar program.

doi.org/10.1016/j.je...