False Modesty: When Disclosing Good News Looks Bad

Rick Harbaugh () and Ted To

No 2005-05, Working Papers from Indiana University, Kelley School of Business, Department of Business Economics and Public Policy

Abstract: Is it always wise to disclose good news? We find that the worst sender with good news has the most incentive to disclose it, so reporting good news can paradoxically make the sender look bad. If the good news is attainable by sufficiently mediocre types, or if the sender is already expected to be of a relatively high type, withholding good news is an equilibrium. Since the sender has a legitimate fear of looking too anxious to reveal good news, having a third party disclose the news, or mandating that the sender disclose the news, can help the sender. The predictions are tested by examining when economics faculty at different institutions use titles such as "Dr" and "Professor" in voicemail greetings and course syllabi.

Keywords: disclosure; persuasion; communication; verifiable message; countersignaling; private receiver information (search for similar items in EconPapers)
JEL-codes: C78 D82 L15 (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (8)

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Journal Article: False modesty: When disclosing good news looks bad (2020)
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