The effect of signaling quality in a service context

Abstract

Signaling theory states that signals are firms' actions that communicate information about the quality of a product. The main purpose of this research is to investigate the effect of signal quality in a service context, through the investigation of the signaling effects of price and responsiveness in a service context. Perceived behavior control, regarded as an individual's perception of the ability to perform a behavior, was proposed as a moderator between signaling variables and perceived quality. Two experimental studies with factorial and inter-subject designs were conducted in order to test the hypotheses formulated from the literature review. Results from both experiments show that signaling quality through price and responsiveness can affect perceived quality. The second experiment supports the hypothesis of perceived behavior control moderation between price as a signaling variable and perceived quality, but not between responsiveness and perceived quality. These results and their implications are discussed in the final section of the paper.

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