Market distortions and government transparency
In this paper, we investigate how government transparency depends on economic distortions. We first consider an abstract class of economies in which a benevolent policy maker is privately informed about the exogenous state of the economy and contemplates whether to release this information. Our key...
| Main Authors: | , , |
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| Format: | Article |
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Wiley
2014
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| Online Access: | https://eprints.nottingham.ac.uk/35635/ |
| _version_ | 1848795125633777664 |
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| author | Albornoz, Facundo Esteban, Joan Vanin, Paolo |
| author_facet | Albornoz, Facundo Esteban, Joan Vanin, Paolo |
| author_sort | Albornoz, Facundo |
| building | Nottingham Research Data Repository |
| collection | Online Access |
| description | In this paper, we investigate how government transparency depends on economic distortions. We first consider an abstract class of economies in which a benevolent policy maker is privately informed about the exogenous state of the economy and contemplates whether to release this information. Our key result is that distortions limit communication: even if transparency is ex ante Pareto superior to opaqueness, it cannot constitute an equilibrium when distortions are sufficiently high. We next confirm this broad insight in two applied contexts, in which monopoly power and income taxes are the specific sources of distortions. (JEL: D82, E61) |
| first_indexed | 2025-11-14T19:27:07Z |
| format | Article |
| id | nottingham-35635 |
| institution | University of Nottingham Malaysia Campus |
| institution_category | Local University |
| last_indexed | 2025-11-14T19:27:07Z |
| publishDate | 2014 |
| publisher | Wiley |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | nottingham-356352020-05-04T16:40:47Z https://eprints.nottingham.ac.uk/35635/ Market distortions and government transparency Albornoz, Facundo Esteban, Joan Vanin, Paolo In this paper, we investigate how government transparency depends on economic distortions. We first consider an abstract class of economies in which a benevolent policy maker is privately informed about the exogenous state of the economy and contemplates whether to release this information. Our key result is that distortions limit communication: even if transparency is ex ante Pareto superior to opaqueness, it cannot constitute an equilibrium when distortions are sufficiently high. We next confirm this broad insight in two applied contexts, in which monopoly power and income taxes are the specific sources of distortions. (JEL: D82, E61) Wiley 2014-02-01 Article PeerReviewed Albornoz, Facundo, Esteban, Joan and Vanin, Paolo (2014) Market distortions and government transparency. Journal of the European Economic Association, 12 (1). pp. 200-222. ISSN 1542-4766 http://onlinelibrary.wiley.com/doi/10.1111/jeea.12052/abstract doi:10.1111/jeea.12052 doi:10.1111/jeea.12052 |
| spellingShingle | Albornoz, Facundo Esteban, Joan Vanin, Paolo Market distortions and government transparency |
| title | Market distortions and government transparency |
| title_full | Market distortions and government transparency |
| title_fullStr | Market distortions and government transparency |
| title_full_unstemmed | Market distortions and government transparency |
| title_short | Market distortions and government transparency |
| title_sort | market distortions and government transparency |
| url | https://eprints.nottingham.ac.uk/35635/ https://eprints.nottingham.ac.uk/35635/ https://eprints.nottingham.ac.uk/35635/ |