Dynamic Information Acquisition and Optimal Disclosure Frequency

We develop a model where information acquisition and disclosure are jointly chosen over time. The manager seeks to maximize future stock prices, and collects information privately about underlying firm fundamentals. Information acquisition increases the arrival rate of private information signals, but it is costly. The manager can choose to make public disclosures about his information if any. Our model can characterize the trade-offs in the dual information acquisition/disclosure decision when such decisions have to be made over time and the manager has reputational concerns. We consider the impact of the information acquisition and disclosure activities upon the firm's endogenous productivity investments. Furthermore, we analyze the optimal mandatory disclosure frequency from the perspective of a regulator aiming to maximize firm value.