Noah and Alyssa have 130 hours of college credit each from Impressive University. Each has 30 hours of economics. Noah has a bachelor's degree, whereas Alyssa is three credits short of required history classes and therefore does not have a degree. Each of them has one year of experience as a market analyst for ABC Company. Assuming that the history class would not enhance Alyssa's job performance, if Noah earns a higher salary than Alyssa, the ABC Company may subscribe to the

Question

Quizplus · Accepted Answer

The signaling theory suggests that education and degrees serve as a signal to employers about a potential employee's productivity or capabilities, even if the specific education (like the history class in Alyssa's case) does not directly enhance job performance. Since Noah has a degree and Alyssa does not, despite having almost identical qualifications otherwise, the difference in their salaries could be attributed to the degree acting as a signal of competence or reliability to the employer.

Noah and Alyssa Have 130 Hours of College Credit Each