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I think they are quite similar. I am a bit confused. Can anyone explain this to me?

I got the name and the information about the cue utilitarian theory from a journal article that related to organic food consumption. According to the authors, when people buy products like organic food, they could hardly evaluate the quality by merely observing it, since organic food could be kind of credence product. It is difficult to evaluate whether it is really free from chemicals and pesticides. So, people tend to rely on some cues to make the quality evaluation indirectly. This is how the Cue Utilitarian Theory works.

Let me narrow it down to a consumer behavior context. It seems to me that both theories can be used to explain that when there is an information asymmetric between retailers and consumers, some product attributes will be used as cues to evaluate product quality. I just wonder if they are basically the same in concept, then how and which one should I use them respectively.

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Ok, let me narrow it down to a consumer behavior context. It seems to me that both theories can be used to explain that when there is an information asymmetric between retailers and consumers, some product attributes will be used as cues to evaluate product quality. I just wonder if they are basically the same in concept, then how and which one should I use them respectively. I think this is more in an information economic perspective. –  user20849 Jun 19 at 7:42
    
@user20849 What do you mean by "cue utiliarian theory"? Can you be more specific? –  Oliv Jun 19 at 11:04
    
I never heard of signaling theory in economics. Signaling games? Contract theory? and as @Oliv pointed out: Neither me nor Google has some useful information on cue utilitarian theory. Could you explain these two terms to us? –  The Almighty Bob Jun 19 at 12:07
    
I vote to close this question as unclear. Could you please add a short explanation of what you mean by the two terms? Especially the cue utilitarian theory is pretty unclear. We don't need a complete definition but just something to start from. As soon as you have done we will open this question again. –  The Almighty Bob Jun 19 at 12:10
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Did you mean 'cue utilization theory'? –  NickJ Jun 20 at 14:50

1 Answer 1

I think you do mean cue utilization theory. According to the link provided in @NickJ's comment, and as far as economic theory goes, I'd say that cue utilization is basically a signaling story.

Putting "cues" on organic food products (e.g. the "organic" label, information on nutrition and natural content) amounts to a signaling act committed by the seller. Since the organic cues is less costly for the real organic food producers to produce (for instance, labeling non-organic foods as organic would face legal disputes, and hence a negative expected cost), these cues (or signals) are reliable.

Thus in principle, organic food sellers sending cues to consumers is no different from the classical signaling model where job seekers uses university degrees to signal their ability.

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Oh, yes, my God, I do mean Cue Utilization Theory. There was a typo in my previous messages. Really sorry to confuse you guys. Thank you for your explanation. –  user20849 Jun 23 at 3:52
    
@user20849: In that case, would you please consider editing your original question and its title to reflect the correction? Thank you :) –  Herr K. Jun 23 at 7:28

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