Cookies?
Library Header Image
LSE Research Online LSE Library Services

The wrong kind of transparency

Prat, Andrea (2002) The wrong kind of transparency. . Suntory and Toyota International Centres for Economics and Related Disciplines, London, UK.

[img]
Preview
PDF
Download (473kB) | Preview

Abstract

In a model of career concerns for experts, when is the principal hurt from observing more information about her agent? This paper introduces a distinction between information on the consequence of the agent's action and information directly on the agent's action. It is the latter kind that can hurt the principal by engendering conformism, which worsens both discipline and sorting. The paper identifies a necessary and sufficient condition on the agent signal structure under which transparency on action is detrimental to the principal. The paper also shows the existence of complementarities between transparency on action and transparency on consequence. The results are used to interpret existing disclosure policies in politics, corporate governance, and delegated portfolio management.

Item Type: Monograph (Discussion Paper)
Official URL: http://sticerd.lse.ac.uk/
Additional Information: © 2002 by Andrea Prat
Divisions: STICERD
Economics
Subjects: H Social Sciences > HD Industries. Land use. Labor
JEL classification: D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D82 - Asymmetric and Private Information
Date Deposited: 03 Mar 2008
Last Modified: 15 Sep 2023 22:52
URI: http://eprints.lse.ac.uk/id/eprint/3679

Actions (login required)

View Item View Item

Downloads

Downloads per month over past year

View more statistics