It is difficult to be sure that managers in developing countries report financial information
accurately and truthfully during firm surveys. The most common concern is that managers might
under-report performance to avoid attracting attention from the tax authorities or corrupt
bureaucrats. Using a method developed in the literature on corruption, this paper identifies
managers who appear to be reticent or deceptive and compares their answers with the answers of
non-reticent managers. The paper shows that reticent managers report that their firms are more,
not less, productive than non-reticent managers. The paper then assesses possible reasons for
this, finding that the most likely explanation is that reticent managers exaggerate performance so
that they or their firms look good. Because past studies have found that reticent managers appear
to lie about other aspects of firm and manager behavior—including underreporting corruption—
this suggests that it will be difficult to fully assess how these behaviors affect firm performance
unless reticence is controlled for.