Costs and benefits of business information disclosure

A study analyzes the costs and benefits of disclosure of information by profit-making enterprises. The costs and benefits treated in the analysis are categorized by interests: 1. the entity's interests, 2. nonowner investors' interests, and 3. the national interest. The dominant trend appears to be the rapidly decreasing costs of preparing and communicating disclosure. This would increase the optimal disclosure level for private companies. For public companies, unless competitors develop the capability to impose significantly greater competitive disadvantages through the use of the information or litigation costs become more perverse, the most likely result is that the optimal level of disclosure will increase in the future. The 2nd information-technology trend, users' greater power to access and interpret information, will increase all users' benefits.