Tag
signal_processing
2 findings
Labour & employmentSignal Variance Reduction for Risk-Averse FirmsTheoretical derivation proves that reducing signal noise variance ($\sigma^2$) strictly increases expected match value and wages for any employer risk-aversion coefficient $r < 1.2533$.Expert TheoryLabour & employmentSignal Variance Reduction ModelReducing signal variance ($\sigma^2$) strictly increases both the unconditional hiring probability $\Phi\left(\frac{-0.5r\sigma^2}{\sqrt{1+\sigma^2}}\right)$ and expected match quality, provided the firm's absolute risk aversion coefficient $r < 1.2533$.Expert Theory