Signalling theory

Abstract

Even though signaling theory seems to be well acknowledged and considered in particular management research areas, such as strategy, corporate governance or mergers & acquisitions, adoption in a purchasing and supply management context in business-to-business relations seems to be lagging. Hence, this contribution tries to uncover the most important constructs for signaling theory and renders its general conditions for application. While the signaling and receiving entities that exchange signals are often at the heart of signaling related inquiries, other important features, such as opportunity sets, signaling costs, signal confirmation, feedback-loop or signaling environment seem to be neglected. In addition, detailing conditions of signaling theory and testing if the application of the theory is valid often seems to be more of a side topic. Besides detailing constructs and conditions (incl. current discussions), this article sheds light on previous publications dealing with purchasing and supply management issues from a signaling theory perspective and also provides an outlook on further research opportunities.