Handicaps must be hard to fake

We have seen in a previous post What the handicap principle is. However an issue arose on the exact meaning of Cost of a Handicap.

A handicap must be Hard to fake, not directly Costly. Cost is only in relation to the interchange.

What is a cheater?

In Handicap Principle jargon, a cheater is an individual that emits the signal despite being unfit. This faking must be difficult to achieve for an equilibrium to be obtained between fakers and honest signalers. Faking is hard and a whole school around self-deception (like Trivers) is based on this.  Deceiving yourself makes it easier to do.

For example, a handicap is only costly when you fake it badly and you get caught. In nature, this is when the Lion chases the Gazelle despite the signal, or when an employer asks for the diplomas you added on your résumé but do not actually have. There is no cost in emitting the signal, only in your bluff being called on.

In Spence’s paper ‘Signaling in Retrospect and the Informational Structure of Markets’, the signal that is education has a cost though. The trait that is signalled is productive capacity, and one signal for it is education. More on this in the post Honest Signaling in Labor Markets.


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