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This dissertation consists of two essays in the area of corporate voluntary disclosure of predecision information. The first essay entitled, "Disclosure Choice in a Duopoly", focusses on the phenomenon of partial disclosure, where the manager of the firm discloses selected signals and withholds the rest. The manager may or may not receive private information which is related to both firm-specific and industry-wide common factors. The motivation for disclosure (non-disclosure) is derived from the proprietary nature of the manager's private information. The cost (benefit) of disclosure is modelled in an imperfectly competitive product market, where an uninformed opponent’s reaction to a disclosure affects the manager's expected profit. Our results indicate that the nature of the manager's optimal disclosure policy is crucially dependent on whether the signal is more informative about firm-specific or industry-wide common factors. Unfavourable news is disclosed and favourable news withheld if the signal is more informative about common factors. On the other hand, favourable news is disclosed and unfavourable news is withheld if the signal is more informative about firm-specific factors. Comparative statics show that the sensitivity of the optimal disclosure policy and the probability of disclosure to some key parameters are also dependent on this characteristic of a signal. The empirical implications of our results suggest that when testing hypotheses involving voluntary disclosures, failure to take the above characteristic into account may confound the results. The second essay entitled, "Disclosure and Reputation in Credit Markets", deals with a different aspect of voluntary disclosures. A reputation game is modelled in the absence of credible disclosure. The manager's ability with respect to obtaining predecision information is of interest to the firm's creditors. The manager's future nominal interest charges depend on the creditors' belief about the manager's ability, i.e., on his reputation. Hence, the manager attempts to communicate this ability through sub-optimal production choice and creditors learn about the manager by observing the end of period revenue realization. If credible disclosures are possible the manager may make direct disclosures to communicate his information gathering ability to the creditors. This alternative mechanism avoids the cost of reputation building incurred by selecting a suboptimal project. However, it is shown that if these two mechanisms for reputation acquisition are not "independent", then the possibility of disclosure increases the manager's incentive to select a sub-optimal action.

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Where individuals standing outside of the corporation have been harmed by the acts of one of its directors or officers, the question becomes whether they have only a claim against the corporation or whether they may have also a personal claim against the executive inflicting the harm on them. / The issue of how far it should be possible to hold directors and officers personally liable for tort has been a contested one and even courts within one and the same jurisdiction provide different solutions. On the one hand, there is the general basic principle that individuals causing harm to others should be held responsible. On the other hand, the fact that directors and officers act as agents on behalf of the corporation might call for an exception to this basic tort law principle. / This thesis will compare the solutions proposed by Common law (with focus on the law of Ontario) and German law as an example of a Civil law jurisdiction. An attempt will be made to see in how far the proposed solutions are consistent with legal principles like the separate legal entity of the corporation and the concept of limited liability as well as with arguments related to economic efficiency.

The business corporation is an important engine for the creation of wealth and it plays a vital role in promoting economic development and social progress in both domestic and international economies. Hence companies must operate within a governance framework that keeps them focused on their objectives and accountable for their actions. There is the need to establish adequate and credible governance arrangements. The degree of observance to the basic principles of good corporate governance is an important factor for investment decisions. / Traditional corporate doctrine has taken the separation of ownership from control as the core problem of corporate governance. On this view, the principal function of corporate law is to devise strategies and mechanisms to ensure that corporate decision-making is based only on shareholders' interests. However, corporate managers are subject to influence from many other sources. Thus, the study of corporate governance must take account of all factors that affect managerial decision-making. / In this thesis, I examine the influence that debt financing brings to bear on corporate governance and examine whether debt-holders should be beneficiaries of corporate fiduciary duties. I conclude that any such duty should be narrowly cast.

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The objectives of the study are: (1) to determine whether or not price-level changes will have an effect upon the selected firms' earned capital, (2) to determine if the Pffect of inflation on the earned capital of the public utility companies is less than equal to or more than the effect on the earned capital of other industries, and (3) to identify critical variables affecting the selected firms' earned capital erosion due to price-level changes.Subjects were 153 companies: 38 non-utility companies and 115 utility companies. Equal size observations were used in analyzing each group (approximately 380, or 190 each).To obtain data the study chose firms from COMPUSTAT tapes for the years 1977 through 1981. Although several adjusted information items were available, some adjustments were needed for analysis, such as depreciation and tax liabilities. Price-level adjustments were made in accordance with procedures recommended by the Financial Accounting Standards Board.For the statistical analysis, the following null hypotheses were tested at the .05 level of significance:Ho1 : The price-level change will not affect the firms' earned capital erosion.H02 : (1) There is no significant earned capital erosion of the non-utility industry due to price-level changes (lefttailed test).(2) There is significant earned capital erosion of the utility industry due to price-level changes (righttailed test).The Z test statistic was used to test each null hypothesis. Multiple regression analyses were done to identify the critical variables affecting the firms' earned capital erosion under the price-level changes by using taxation, depreciation, payout ratio, and rate of inflation variables.As a result of the hypotheses, null hypothesis 1 was rejected. It could be concluded that the price-level changes did affect the firms' earned capital erosion due to inflation.Null hypothesis 2 for the non-utility industry was rejected (p<.05). The analysis indicated that there is significant earned capital erosion of the non-utility industry due to price-level changes. The null hypothesis 2 for the utility industry was rejected also. It could be concluded that there was no significant earned capital erosion of the utility industry due to inflation.From these results the first and second objectives of the research were met. The price-level changes did affect the selected firms' earned capital, the direction of the earned capital erosion between non-utility and utility groups was completely opposite. The price-level changes do erode the firms' earned capital, but this is not the case for the utility industry. The results of regression analysis indicated that the critical variables affecting the firms' earned capital erosion were taxation, depreciation, payout ratio, and rate of inflation. However, the relative importance of the independent variables was slightly different between the two groups.For the non-utility group the most important variable was payout ratio, followed by taxation and rate of inflation. In the utility industry group the most important variable was taxation, followed by depreciation, rate of inflation, and payout ratio.The following recommendations are made for further research:1. This study should be linked with the analysis of general capital erosion including contributedcapital under the price-level changes.2. The inventory valuation method should be considered for the future analysis of capitalerosion by using dummy variables, although these were not used in this research. It willcertainly become a more powerful model if the inventory valuation method were considered.3. For the in-depth analysis different models should be used for the different industry groups,and not just a general model.4. A study on the microeconomic effects of the tax burden shift associated with capital erosion due to inflation behavior is recommended.5. Finally, any kind of action to be taken by the Congress should be designed to alleviate capital erosion due to inflation.It is strongly recommended that the utility industry not include monetary gains or losses in the calculation of taxable income to prevent corporations' capital from overpaying through income taxing.

The purpose of this thesis was to examine the attitudes toward corporate advertising held by those individuals most closely associated with it: corporate and advertising agency executives. No previous research had been conducted in this particular area.An attitude scale was administered to eighty-two corporate and advertising agency executives, representing a sample from Fortune's one hundred largest corporations and the one hundred largest advertising agencies. A frequency distribution, factor analysis, and Q-study were conducted on the data collected.Findings showed the general attitude toward corporate advertising to be favorable. Two factors underlying respondent's attitudes were revealed and broadly identified as "positive value" and "negative value." Rather than viewing corporate advertising in specific terms, respondents' attitudes were factored on the basis of valence, or direction of the statements.The Q-analysis identified three types of attitude patterns existing among the respondents. Type I respondents represented large industrial manufacturers who believe corporate advertising is an effective tool for improving employee morale and recruiting new employees. Type II, consisting of advertising agencies involved in marketing to consumers, saw corporate advertising as a tool for increasing corporate awareness and creating unity among products. A conglomeration of industrial manufacturers, consumer goods manufacturers, and advertising agencies, Type III viewed corporate advertising as an effective part of a total plan, though not capable of achieving tangible objectives by itself. Type and size of firm were the only demographics which could be significantly related to the attitude patterns.These findings indicate that although differences can be found in the management function provided by corporate advertising, respondents hold similar favorable attitudes toward corporate advertising.