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Frequent Reporting and Short-Termism: An Experimental Investigation

Author

Listed:
  • Douglas Davis

    (Virginia Commonwealth University, Richmond, Virginia 23284)

  • Caleb Cox

    (Virginia Commonwealth University, Richmond, Virginia 23284)

  • Oleg Korenok

    (Virginia Commonwealth University, Richmond, Virginia 23284)

  • John Lightle

    (Virginia Commonwealth University, Richmond, Virginia 23284)

Abstract

Financial market regulators have long debated the appropriate frequency of mandatory corporate financial disclosures. Whereas frequent disclosures may help deter overinvestment, they may also encourage short-termism. This paper reports an experiment that examines the effects of varying reporting frequencies on managerial investment decisions. Experimental results indicate that frequent reporting modestly induces short-termism, but it fails to reduce the overinvestment observed in the infrequent reporting regime. Nonbinding communication of intended investment plans does reduce overinvestment, but only in the infrequent reporting regime.

Suggested Citation

  • Douglas Davis & Caleb Cox & Oleg Korenok & John Lightle, 2026. "Frequent Reporting and Short-Termism: An Experimental Investigation," Management Science, INFORMS, vol. 72(2), pages 1341-1355, February.
    • Handle: RePEc:inm:ormnsc:v:72:y:2026:i:2:p:1341-1355
    DOI: 10.1287/mnsc.2023.01955
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    References listed on IDEAS

    as
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