Multiplicity and Simultaneity in Signaling: The Effect of Summary Signals on Partner Selection

Abstract

Prior signaling research has shown that a signal portfolio can communicate multiple underlying attributes of a partner to an organization. However, we know relatively little about how multiple attributes can be effectively signaled to multi-goal organizations. A multi-goal organization often prefers to collaborate with partners who act in accordance with multiple attributes simultaneously, that is, at the same time and in the same context. Although a signal portfolio can show multiple attributes of a partner, a portfolio does not reflect the simultaneity of attributes. We introduce the concept of summary signals, defined as signals that show multiple underlying attributes of a partner simultaneously. We argue that a partner’s likelihood of being selected as a collaboration partner increases with its use of summary signals, and the effect of summary signals is stronger than that of an equivalent signal portfolio. Using data on government procurement of innovation from 2010 to 2019, we find that firms possessing highly cited, green, and joint patents, our measure of summary signals, are more likely to be selected by the government, and that this effect is stronger than the effect of signal portfolios. Our study has important implications for research on signaling, partner selection, and government procurement.