As the UME to GME transition continues to become more competitive, and the challenges of application inflation and over-interviewing continue to grow, residency programs and specialty organizations are planning new interventions with the intention to increase transparency between applicants and programs. For applicants, this involves enhanced means by which to learn of a program’s academic mission, culture and screening requirements, as well as network and better inform programs of their interests. For programs, it is an improved ability to determine the applicants that are most interested in training at their institution.
While much of the applicant-side interventions are accomplished through program websites and marketing materials, the program-side intervention has required more substantial innovation. Following completed pilots, preference signaling will make a broader debut for the ERAS 2022-2023 residency application season in 16 specialties, joining 3 others for a total of 19 specialties.
This 5-part blog series, The Ultimate Guide to Preference Signaling for Medical Residency for Applicants and Programs 2022-2023 includes:
- Part 1: Introduces the history of preference signaling.
- Part 2: Describes its introduction to GME.
- Part 3: Discusses outcomes to date.
- Part 4: Provides advice for applicants and programs.
- Part 5: Describes how Thalamus will support this initiative.
This is Part 1: The Origins of Preference Signaling
The Emergence of Preference Signaling:
Preference signaling was first implemented in 2006, as part of the recruitment process for economics graduate students administered through the American Economics Association (AEA). Since then, there have been several useful studies analyzing this process by leading economists at institutions including Harvard and Stanford. These include “Preference Signaling in Matching Markets” and “The Job Market for New Economists: A Market Design Perspective.”
Of note, one of the authors on the latter article is Dr. Alvin E. Roth, who won the Nobel Prize in Economics for proving certain key attributes of the matching algorithm that is used today by the National Resident Matching Program (NRMP), where Dr. Roth currently serves as a board member. This article has been cited in papers throughout GME that examine preference signaling in specialties including Otolaryngology and Orthopaedic Surgery.
How Preference Signaling is used in Economics:
Students can send up to two preference signals to programs to express an interest to interview with those programs. This occurs during the annual Allied Social Science Associations (ASSA) meeting each January. The signals help programs identify applicants interested in attending their program.
The key point regarding preference signaling here is that each applicant has a (very) limited number of signals. This means that preference signals are a “scarce” resource. Thus, sending a preference signal carries a substantial “opportunity cost.”
The opportunity cost of an activity is defined in economics as the loss of value or benefit that is incurred by engaging in an activity, when compared to an alternate activity that would result in higher value or benefit. In other words, given applicants can only send two signals, the opportunity cost of sending a signal to a program is that the applicant cannot send that signal to any other program.
To reiterate: What makes preference signals valuable is that they are a scarce resource.
Advice for Applicants and Departments in the Economics Market Preference Signaling System:
The AEA publishes a useful guide for stakeholders titled “Signaling for Interviews in the Economics Job Market.”
Advice for Economics Applicants: Applicants are encouraged to avoid sending preference signals to their two top choice programs, but rather programs that they are interested in, but would likely not receive an interview if a preference signal was not sent (i.e. in the event where a program would likely believe the applicant had no interest in attending). Additional guidance centers on using preference signaling to express interest in programs that may be getting many applications from similar applicants (e.g. same school) or programs to which there are no other good ways to signal interest. Applicants are encouraged to be able to explain why a preference signal was sent. Conversely, if asked by a program why they did not send a preference signal, applicants are instructed to communicate that they believed that adequate signaling of interest could be achieved through other channels.
Advice for Economics Departments: Since applicants may only send two total preference signals (and some may send none), not getting a preference signal from an applicant, provides limited information. However, the opposite occurs upon receiving a preference signal. This action conveys valuable information about the applicant’s interest in that program. Departments are encouraged to use preference signals to help break ties in determining which applicants receive interview offers. They are also encouraged to provide a thorough application review to applicants who send a preference signal. To set expectations, the programs are reminded that some departments do not receive preference signals due to program and/or faculty prestige. Applicants do not feel compelled to “waste” a signal on such a program. However, this is not the same as implying that there is no interest in the program as a career destination.
What has been the result of Preference Signaling in Economics?
Some key findings in analyzing economics preference signaling data include:
- Signals sent to highly ranked programs by top academic performing-students were often wasted and rarely resulted in an additional interview.
- Signals sent to lower ranked programs by highly sought-after applicants increased the probability of receiving an interview. ‘
- Signals sent from an applicant with an unusual background may help avoid their application being overlooked.
Overall, Coles et al. found that “introducing a signaling mechanism increases the welfare of workers (applicants) and the number of matches, while the change in firm (program) welfare is ambiguous. (Further), a signaling mechanism adds the most value for balanced markets.”
So Preference Signaling provide benefit to applicants going through the process. The benefit to programs (departments) was less clear.
So how did Preference Signaling find its way to GME? Find out in Part 2!