Endogenizing Discretion in Disclosures

• 成果类型: Article
• 署名作者: Arya, Anil; Ramanan, Ram N. V.
• 署名单位: University System of Ohio; Ohio State University; State University of New York (SUNY) System; Binghamton University, SUNY; Indian School of Business (ISB)
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2022.4505
• 发表日期: 2023
• 页码: 3730-3747
• 关键词: commitment; discretionary disclosures; information system design; LABOR UNION

摘要

A firm's publicly available information reflects ex ante committed information releases and ex post discretionary disclosures. In a setting wherein a firm's CEO is concerned with stock market valuation and confrontations with the employee union, this paper endogenizes when the CEO retains ex post disclosure discretion and when the CEO curtails discretion, opting instead to ex ante commit to not gathering information or publicly disclosing information. The underlying economic forces entail a trade-off between the time-inconsistency problem (the CEO's ex post preferences can diverge from the CEO's ex ante goals) and how silence (absence of information) under the ex ante and ex post paths is valued differentially by the union. In effect, silence under different systems speaks differently, and this influences both the labor union's incentives to engage in bargainingwith the firm and the stockmarket's pricing of the firm's equity.