The relationship between the informational environment and the cost of equity capital has received considerable interest in finance and accounting research as well as in financial reporting regulation. Recent papers have demonstrated that increased public disclosure may decrease firms' cost of...

This paper examines communication in a two-period principal/agent model in which the agent receives a private signal about the second outcome before the first outcome is realized. No communication is compared with communication at three possible dates: before the first outcome (early), at the...