Voluntary disclosure strategies under substitutable and complementary information

This study examines voluntary disclosure in a strategic setting where two competing firms decide whether to disclose private signals that are substitutes or complements. We show that equilibrium outcomes depend on information interactions. With moderate disclosure costs, substitute signals lead to an asymmetric equilibrium – one firm discloses while the other withholds because one firm’s disclosure reduces the other’s marginal value of disclosure. In contrast, complementary signals lead to a symmetric equilibrium – either both firms disclose or neither does – because joint disclosure generates more value than unilateral disclosure. These findings highlight information complementarity’s role in shaping disclosure incentives, extending the literature that largely assumes substitutability.