PT  - JOURNAL ARTICLE
AU  - Moshe Levy
AU  - Golan Benita
AU  - Haim Levy
TI  - Financial Disclosure and Regulation
AID  - 10.3905/jpm.2006.611811
DP  - 2006 Jan 31
TA  - The Journal of Portfolio Management
PG  - 107--115
VI  - 32
IP  - 2
4099  - https://pm-research.com/content/32/2/107.short
4100  - https://pm-research.com/content/32/2/107.full
AB  - A portfolio approach is used here to analyze the value of financial disclosure to stockholders and the need for disclosure regulation. This demonstrates that in a portfolio context the degree of public financial disclosure does not influence a firm's value. Hence, if disclosure is costly, firms have no incentive to disclose information voluntarily. Under partial disclosure, however, investors select inefficient portfolios, implying a substantial welfare loss; hence, we need regulation. The analysis provides a framework for determining optimal disclosure from the point of view of social welfare.TOPICS: Portfolio construction, legal/regulatory/public policy, in portfolio management