Selective Disclosure, Expertise Acquisition and Price Informativeness

Bjørn N. Jørgensen, Jing Li*, Nahum D. Melumad

*Corresponding author for this work

Research output: Contribution to journalJournal articleResearchpeer-review


We examine how a firm's disclosure-audience policy affects investors' expertise acquisition and price informativeness in the market. We distinguish the investors' information advantage due to superior access from that due to superior ability to process information. We show that targeted selective disclosure to sophisticated investors may encourage greater expertise acquisition on the part of investors and lead to more informative prices than either public disclosure or untargeted selective disclosure, because the value of expertise is maximized if sophisticated investors gain exclusive information access at a relatively low cost. These results illuminate the persistence of private communications between investors and firms in the post-Regulation Fair Disclosure era and provide implications for regulators in addressing increasing concerns raised about the enforcement of Regulation Fair Disclosure.
Original languageEnglish
JournalContemporary Accounting Research
Issue number4
Pages (from-to)2305-2337
Number of pages33
Publication statusPublished - Oct 2022

Bibliographical note

Published online: 25 April 2022.


  • Selective disclosure
  • Information access cost
  • Expertise acquisition
  • Price informativeness

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