Yesterday I attended a meetup where the discussion turned to fashion for a time (because apparently the mini-camp participants were given some instructions on fashion as a useful part of instrumental rationality). (Unfortunately none of us knew much about the topic so the discussion turned into "how can we find an expert to advise us for minimal cost?") It was mentioned that dressing "badly" can be a useful signalling device, and some examples were given. Here's an attempt at a more complete list of possible signals one might be sending by dressing "badly".

• I have better use of my time than thinking about what to wear. Since thinking about what to wear is generally a highly valuable use of time, perhaps I'm really productive at something else.
• I'm in a profession where technical skills are valued above social skills.
• Costly signaling is mostly a zero-sum game. I like to opt out of zero-sum games.
• Either I'm a loner or none of my friends care about fashion either. If you care a lot about fashion, our interests are probably too different, and us socializing is probably not the best use of your time or mine.
• I'm a member of a group or subculture where dressing "badly" is normative and used for identification/affiliation.

The idea here is, if you do decide to start dressing "well", know what you're giving up first. (Of course you're also giving up possibly implying that nobody taught you how to dress and you're not sufficiently strategic to have thought of learning it yourself. Or implying that you don't have the mental, financial, and/or social resources to keep up with fashion. A lot of signaling depends on what your audience already knows about you, or can infer from your other signals.) See also Yvain's related post, Why Real Men Wear Pink and comments there.