Spin doctors: An experiment on vague disclosure

Unfavorable news are often delivered under the disguise of vagueness. Our theory-driven laboratory experiment investigates this strategic use vagueness in voluntary disclosure and asks whether there is scope for policy to improve information transmission. We find that profitably deployed by senders fool those receivers lack sophistication. Imposing precise leads more easily interpretable messages, but results fewer sender types disclosing at all. Since non-disclosure also systematically misleads naive receivers, welfare implications imposing precision not obvious. However, our model show transmission improved policies impose precision. speak rules governing firms’ quality-relevant information, research findings, testimonies a court law.