American Economic Review Vol. 104 No. 8 2014

Not Only What but Also When: A Theory of Dynamic Voluntary Disclosure

Ilan Guttman¹; Ilan Kremer²; Andrzej Skrzypacz³

¹ Leonard Stern School of Business, New York University, 44 West Fourth Street, New York, NY 10012 (e-mail: ) · ² Department of Economics and School of Business Administration, Hebrew University, Mount Scopus, Jerusalem, Israel 91905, and Department of Economics, University of Warwick, Coventry CV47AL UK (e-mail ) · ³ Graduate School of Business, Stanford University, 655 Knight Way, Stanford, CA 94305 (e-mail: )

Abstract

We examine a dynamic model of voluntary disclosure of multiple pieces of private information. In our model, a manager of a firm who may learn multiple signals over time interacts with a competitive capital market and maximizes payoffs that increase in both period prices. We show (perhaps surprisingly) that in equilibrium later disclosures are interpreted more favorably even though the time the manager obtains the signals is independent of the value of the firm. We also provide sufficient conditions for the equilibrium to be in threshold strategies.

DOI

10.1257/aer.104.8.2400

Volume

104

Issue

8

Pages

2400-2420

Language

en

Sources

bibtex:phds-export.bib openalex crossref

Cite

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