Good Disclosure, Bad Disclosure

Liyan Yang and Itay Goldstein
Additional contact information
Itay Goldstein: University of Pennsylvania

No 42, 2014 Meeting Papers from Society for Economic Dynamics

Abstract: We study the real-efficiency implications of public information in a model where relevant decision makers learn from the financial market to guide their actions. Whether disclosure is "good" or "bad" depends on the interactions between two effects on real decision makers' forecast. Disclosure has a positive direct effect of providing new information, and it also has an indirect effect of changing the price informativeness. If disclosure is about a variable of which real decision makers are well informed, then the indirect effect is also positive, and overall disclosure improves real efficiency. If disclosure is about a variable that real decision markers care to learn much, then the indirect effect is negative, and it dominates the positive direct effect if and only if the market aggregates information effectively.

Date: 2014
New Economics Papers: this item is included in nep-cta and nep-hpe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://red-files-public.s3.amazonaws.com/meetpapers/2014/paper_42.pdf (application/pdf)

Related works:
Journal Article: Good disclosure, bad disclosure (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:red:sed014:42

Access Statistics for this paper

More papers in 2014 Meeting Papers from Society for Economic Dynamics Society for Economic Dynamics Marina Azzimonti Department of Economics Stonybrook University 10 Nicolls Road Stonybrook NY 11790 USA. Contact information at EDIRC.
Bibliographic data for series maintained by Christian Zimmermann ().