Corporate Investment in the Absence of Peer Firms' Disaggregated Cost Information*

This study investigates how the availability of proprietary cost information influences corporate investment. By leveraging the regulatory cessation of disaggregated cost reporting in Korea, we document a decline in investment-q sensitivity after peers stop disclosing the detailed cost information, suggesting significant externalities arising from peers' proprietary information contained in cost reports. This finding is robust to alternative measures and estimation methods. We echo the importance of disaggregated cost information in product market competition and managerial learning from peer disclosure.