Monitor Reputation and Transparency

• 成果类型: Article
• 署名作者: Marinovic, Ivan; Szydlowsii, Martin
• 署名单位: Stanford University; University of Minnesota System; University of Minnesota Twin Cities
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MICROECONOMICS
• ISSN/ISSBN: 1945-7669
• DOI: 10.1257/mic.20220006
• 发表日期: 2023
• 页码: 1-67
• 关键词: auditor reputation; bank loans; big 4; INFORMATION; QUALITY; CHOICE; disclosure

摘要

We study the disclosure policy of a regulator overseeing a monitor with reputation concerns. The monitor faces a manager, who chooses how much to manipulate based on the monitor's reputation. Reputational incentives are strongest for intermediate reputations. Instead of providing transparency, the regulator's disclosure policy aims to keep the monitor's reputation intermediate, even at the cost of diminished incentives. Beneficial schemes feature random delay or noisy information. Schemes that feature verifiable disclosure destroy reputational incentives. The regulator discloses more aggressively when she has better enforcement tools.