Multidimensional Competition and Corporate Disclosure Articles uri icon

publication date

  • April 2016

start page

  • 298

end page

  • 328


  • 3-4


  • 43

International Standard Serial Number (ISSN)

  • 0306-686X

Electronic International Standard Serial Number (EISSN)

  • 1468-5957


  • In this paper, we argue that the influence product market competition exerts on disclosure is defined by the combined effect of the incentives and disincentives to disclose raised by the multiple competition dimensions. We distinguish between firm- and industry-level competition measures, and we hypothesize that the former raises agency and proprietary costs, whereas the latter creates incentives to disclose either to fulfil the owners' need for information to monitor managers or to deter the entrance of new competitors in the industry. Our research design allows for non-monotonic relationships between competition and disclosure as well as for interactions between competition dimensions. Using a sample of US manufacturing companies, we gather evidence that is consistent with our hypotheses.


  • disclosure; product market competition; segment reporting; agency conflicts; proprietary costs; incentives to disclose; disincentives to disclose; product market competition; sfas no. 131; voluntary disclosure; earnings quality; private firms; agency costs; bad-news; information