Essays on Disclosure

Abstract

In this paper I attempt a taxonomy of the extant accounting literature on disclosure and suggest as categories: "association-based disclosure," work that studies the effects of disclosure on asset equilibrium prices and trading volume; "discretionary-based disclosure," work that examines managers' discretion in the disclosure of information about which they may have knowledge; and "efficiency-based disclosure," work that discusses which disclosure arrangements are preferred in the absence of prior knowledge of the information. In addition, in the final section of the paper, I discuss information asymmetry reduction as a starting point for a comprehensive theory of disclosure.

Keywords: Disclosure; Information asymmetry reduction; Cost of capital

JEL Classification: G12, G14, M41, M45