Abstract: This paper develops a model analyzing the impact of information transparency in
administrative rulemaking. The key items of information are the regulated party’s
communication and the agent’s signal based on that communication. Information
disclosure not only allows the principal to observe the information, but it may also
increase her power in the decision, measured by the probability that she can to select the
final policy. A key result is that, even without mandating any disclosures, the principal
can have the same knowledge as the agent does about what level of regulation would be
optimal. Instead of increasing knowledge, transparency primarily benefits the principal
when it increases her power through the disclosures. However, it may also discourage
the regulated party or agent from generating information in the first place. There are
empirical implications to determine the model’s applicability and institutional design
implications to the extent it is applicable.