Michael Spence

Michael Spence is an American economist recognized for his work on how people and companies acquire skills and information in the job market. He introduced the idea of "signaling," where job seekers and employers use signals—like education or experience—to convey information about abilities and quality. This theory explains why individuals pursue certain education levels and why employers value specific credentials. Spence's insights help understand how markets operate efficiently despite imperfect information, influencing labor economics and education policy by highlighting the role of signaling in matching workers to jobs.