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Applied and bridge studies study record
Networks, information & disclosureVoluntary Disclosure, Selective Memory
STATUS · Manuscript in progressSSRN · Not yet posted
MECHANISM
Identify the incentive structure and the condition that would falsify the claim.
RULE CHANGE
Read the intervention only after the paper shows how the current payoff space fails to support system welfare.
READER USE
Use the summary to see where private gain creates system exposure, then check the study record.
Reading βW
βW means annual system-welfare loss divided by annual industry revenue Π. Revenue is the denominator, never profit, earnings, or net income; ΔW and Π must use the same domain, same time period, and same activity boundary. See the βW methodology manual.
Contribution — what this adds to the conversation
Provides a formal game-theoretic model and empirical case study that extends the MST/DA canon to the domain of voluntary disclosure. Contributes to the literature on disclosure regulation and corporate governance.
WHAT'S NEW · Original formal theorems (VDWT, DFT, HWDT) and the concept of 'selective memory' as a mechanism for voluntary disclosure failure. However, the core insight that voluntary disclosure fails due to structural incentives is already present in the canon.
The paper establishes that voluntary disclosure regimes are structurally incapable of protecting system welfare due to the Missing System Theory. Firms selectively disclose outcome information while suppressing process-level reasoning, creating a 'Reconstruction Gap' that cannot be closed by more disclosure. Using the βW metric, the paper shows that high-impact sectors destroy at least $5 of system welfare per dollar of revenue. The solution is mandatory Decision Accounting, which requires firms to contemporaneously record system welfare impact.