Editing Countersignaling (section)

==Signals and signaling theory==
{{essay|date=July 2024}}

Much research is concerned with understanding what signals signalers should send to convince a receiver that they have a certain property, and what signals a receiver should be convinced by. One way of doing this is by putting money on the table just to prove that you can; someone without the property would not be able to do the same. For example, in biology [[peacock]]s expend energy on elaborate plumage that increase their risk of dying. By doing this they demonstrate their genetic fitness, as genetically less fit males can only grow small plumage, while genetically better individuals can grow larger ones (in [[biology]], this is known as the [[handicap principle]]).{{cn|date=October 2024}}

Countersignaling, by contrast, is showing off by not showing off, or by playing humble. For instance, the ''[[new money]]'' are eager to flaunt their wealth, and often surround themselves with expensive luxury items. Those with old money are more understated, preferring not to waste money on what they deem frivolities.<ref name= "Rand">Nick Feltovich, Rick Harbaugh and Ted To, [http://kelley.iu.edu/riharbau/cs-randfinal.pdf "Too cool for school? Signalling and Countersignalling"], ''RAND Journal of Economics'', Vol. '''33''', Winter 2002, 630-649</ref>

There are a number of different models that deal with this behavior and explain how rational individuals – those interested only in maximising certain utility – would find countersignaling beneficial. One of these is by Feltovich, Harbaugh and To.<ref name= "Rand"></ref><ref>"Signal failure? The economics of understatement". ''The Economist'' May 2003. Covering the same Feltlvich/Harbaugh/To paper.</ref> They developed a formal model in which receivers of signals judge the senders of signals based not only on what can be inferred from the signal sent, but also on additional information, which is assumed to be helpful but not perfect. For example, senders might be of low, medium, or high quality, and the additional information might be adequate for distinguishing low from high but not necessarily from distinguishing medium from low or high. Under certain circumstances, medium-quality senders will have an incentive to signal (to ensure that they can be distinguished from low-quality ones), but high-quality senders may not—they are not likely to be mistaken for low-quality senders in any case, and signaling behavior may mark them as medium.{{cn|date=October 2024}}