IDEAS home Printed from https://ideas.repec.org/a/aea/aecrev/v104y2014i8p2400-2420.html
   My bibliography  Save this article

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

Author

Listed:
  • Ilan Guttman
  • Ilan Kremer
  • Andrzej Skrzypacz

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.

Suggested Citation

  • Ilan Guttman & Ilan Kremer & Andrzej Skrzypacz, 2014. "Not Only What but Also When: A Theory of Dynamic Voluntary Disclosure," American Economic Review, American Economic Association, vol. 104(8), pages 2400-2420, August.
  • Handle: RePEc:aea:aecrev:v:104:y:2014:i:8:p:2400-2420
    Note: DOI: 10.1257/aer.104.8.2400
    as

    Download full text from publisher

    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/aer.104.8.2400
    Download Restriction: no

    File URL: http://www.aeaweb.org/aer/app/10408/20120468_app.pdf
    Download Restriction: no

    File URL: http://www.aeaweb.org/aer/ds/10408/20120468_ds.zip
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Viral V. Acharya & Peter DeMarzo & Ilan Kremer, 2011. "Endogenous Information Flows and the Clustering of Announcements," American Economic Review, American Economic Association, vol. 101(7), pages 2955-2979, December.
    2. Pae, Suil, 2005. "Selective disclosures in the presence of uncertainty about information endowment," Journal of Accounting and Economics, Elsevier, vol. 39(3), pages 383-409, September.
    3. Verrecchia, Robert E., 1983. "Discretionary disclosure," Journal of Accounting and Economics, Elsevier, vol. 5(1), pages 179-194, April.
    4. Grossman, Sanford J, 1981. "The Informational Role of Warranties and Private Disclosure about Product Quality," Journal of Law and Economics, University of Chicago Press, vol. 24(3), pages 461-483, December.
    5. Sudipto Bhattacharya & Jay R. Ritter, 1983. "Innovation and Communication: Signalling with Partial Disclosure," Review of Economic Studies, Oxford University Press, vol. 50(2), pages 331-346.
    6. Grossman, S J & Hart, O D, 1980. " Disclosure Laws and Takeover Bids," Journal of Finance, American Finance Association, vol. 35(2), pages 323-334, May.
    7. Paul R. Milgrom, 1981. "Good News and Bad News: Representation Theorems and Applications," Bell Journal of Economics, The RAND Corporation, vol. 12(2), pages 380-391, Autumn.
    8. Eti Einhorn & Amir Ziv, 2008. "Intertemporal Dynamics of Corporate Voluntary Disclosures," Journal of Accounting Research, Wiley Blackwell, vol. 46(3), pages 567-589, June.
    9. Hyun Song Shin, 2006. "Disclosure Risk and Price Drift," Journal of Accounting Research, Wiley Blackwell, vol. 44(2), pages 351-379, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sergiu Hart & Ilan Kremer & Motty Perry, 2017. "Evidence Games: Truth and Commitment," American Economic Review, American Economic Association, vol. 107(3), pages 690-713, March.
    2. Ganglmair, Bernhard & Holcomb, Alex & Myung, Noah, 2016. "Cutthroats or comrades: Information sharing among competing fund managers," MPRA Paper 71506, University Library of Munich, Germany.
    3. Kfir Eliaz & Alexander Frug, 2016. "Bilateral trade with strategic gradual learning," Economics Working Papers 1543, Department of Economics and Business, Universitat Pompeu Fabra, revised Sep 2017.
    4. repec:spr:joecth:v:65:y:2018:i:4:d:10.1007_s00199-017-1048-x is not listed on IDEAS
    5. repec:eee:gamebe:v:107:y:2018:i:c:p:380-395 is not listed on IDEAS
    6. repec:eee:jetheo:v:175:y:2018:i:c:p:652-688 is not listed on IDEAS
    7. Eliaz, Kfir & Frug, Alexander, 2016. "When to Learn What in Bilateral Trade," CEPR Discussion Papers 11350, C.E.P.R. Discussion Papers.

    More about this item

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aecrev:v:104:y:2014:i:8:p:2400-2420. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael P. Albert). General contact details of provider: http://edirc.repec.org/data/aeaaaea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.