Essays on the Economics of Communication and Disclosure
Oliver, Atara S
Eraslan, Hulya; Pai, Mallesh
Doctor of Philosophy
Individuals convey information through the messages that they send, and—just as importantly—through the messages they do not send. In this dissertation, I focus on two important applications of communication—the publication decisions of the media and the disclosure decisions of job applicants. While these applications differ, in both cases the individuals carefully consider the implications of their messages, and may benefit from keeping silent. In my first chapter, I consider the effect of the 24-hour nature of internet news on the posting decisions of a media firm. To do so, I compare a scenario in which the news can be posted and updated at any time to a scenario in which news can only be posted at a fixed time. I determine the editorial standard, which is a cutoff that determines how certain a firm must be in order to initially post an article. If changing a story is costly, then the firm's editorial standard is weakly higher when it can post at any time, and it decreases over time. This implies that the internet may lead the firm to be more cautious. However, if the firm has a strong prior about the event, it may post earlier with less information when it can post on the internet at any time. In my second chapter, I consider recently implemented policies that prohibit employers from asking job applicants to reveal their current wages. This policy change makes wage disclosure a strategic choice for applicants. I consider a model in which an applicant applies for a job, and the employer can choose to make her an offer at a cost. I find that if an applicant does not initially know how much she will benefit from the job, then there can exist a partial disclosure equilibrium in which the applicant conceals her wage if it is low or high, but reveals intermediate wages. In any such equilibrium, no type of applicant is worse off than she would be under full disclosure, and some types of applicants are better off. The effect of this policy on the wage gap is ambiguous.
communication; disclosure; media; news; wage negotiations