TY - JOUR
T1 - The optimal amount of discretion to allow in disclosure
AU - Fishman, Michael J.
AU - Hagerty, Kathleen M.
PY - 1990/1/1
Y1 - 1990/1/1
N2 - In this paper a party with private information can verifiably disclose some, but not all, of his information. The optimal amount of discretion to allow the informed party is studied. That is, should the informed party be allowed unlimited discretion in choosing which elements of his information set to disclose, or should restrictions be imposed that limit this discretion? The model is formulated in the spirit of a “persuasion game.” It is demonstrated that under certain circumstances, rules that limit discretion increase the informativeness of disclosures and thus improve economic decisions.
AB - In this paper a party with private information can verifiably disclose some, but not all, of his information. The optimal amount of discretion to allow the informed party is studied. That is, should the informed party be allowed unlimited discretion in choosing which elements of his information set to disclose, or should restrictions be imposed that limit this discretion? The model is formulated in the spirit of a “persuasion game.” It is demonstrated that under certain circumstances, rules that limit discretion increase the informativeness of disclosures and thus improve economic decisions.
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U2 - 10.2307/2937794
DO - 10.2307/2937794
M3 - Article
AN - SCOPUS:0000772031
SN - 0033-5533
VL - 105
SP - 427
EP - 444
JO - Quarterly Journal of Economics
JF - Quarterly Journal of Economics
IS - 2
ER -