This paper considers how the presence of a speculative investor, who bets on a firm's future earnings report, affects how the firm's management manipulates that report. We examine the influence of the speculator's information on earnings management behavior, quality of reported earnings, and...

I examine the credibility of a manager's disclosure of privately observed nonverifiable information to an investor in a repeated cheap-talk game setting. In the single-period game no communication occurs. In the repeated game, however, the manager almost always truthfully reveals his private...

This monograph surveys the analytic accounting disclosure literature in which firms strategically communicate information to investors. Its purpose is to identify guidelines that firm management might consider when voluntarily disclosing or mandatorily reporting information to investors and also...

We model the relationship between an entrepreneur's monitoring of a manager's performance and the entrepreneur's choice of the firm's financial disclosure policy. The environment is characterized by incomplete contracting and the presence of informed traders. We show that the entrepreneur may...

We examine how the threat of litigation affects an entrepreneur's reporting behavior when the entrepreneur (i) can misrepresent his privately observed information, (ii) pays legal damages out of his own pocket, and (iii) is optimistic about the firm's prospects relative to investors. We find...

type="main" <p>A firm surveys a large number of consumers, some of whom sincerely report their tastes and others of whom report strategically. It makes product decisions using the sample mean of survey responses. When firms and consumers agree on the fraction of sincere consumers, information loss...</p>

We study information transmission via polling. A policymaker polls constituents, who differ in their information and ideology, to determine policy. Full revelation is an equilibrium in a poll with a small sample, but not with a large one. In large polls, full information aggregation can arise in...

We consider the design of contracts in a principal-agent setting with two agents where each agent privately observes and reports to the principal a signal regarding the actions taken. We consider two cases: one where the agents observe the same signal and one where the agents observe different...

We analyze the effect of external financing concerns on managers' financial reporting behavior prior to management buyouts (MBOs). Prior studies hypothesize that managers intending to undertake an MBO have an incentive to manage earnings downward to reduce the purchase price. We hypothesize that...