Time-varying managerial overconfidence and pecking order preference

Counterparty Responses to Managerial Overconfidence

Existing research links CEO personality traits to a number of corporate decisions including overinvestment, external acquisitions, and earnings management. These findings raise the question of whether counterparties distinguish between differences in individual CEO behavior, and how they respond to it. We focus on two key counterparties – auditors and credit rating agencies – and examine whethe...

Managerial Overconfidence and Bank Risk Taking: A Cross-Country Analysis

This paper examines the effects of managerial overconfidence on bank risk taking and investigates whether improvements in governance can help to mitigate the adverse effects of managerial overconfidence on bank risk taking by using ordinary least squares method. The sample consists of the financial institutions in G20 and Taiwan over the period of 2005-2012. The executive overconfidence is meas...

Managerial Overconfidence , Agency Problems , Financing Decisions and Firm Performance

Order Effect and Time Varying Categories

The main purpose of this study is to examine how people learn time-varying categories as well as whether order effect exists in such learning. To this end, we design three types of category structures, in which the stimuli vary along trials in an ascending, descending, and quadratic trend. Also, tendency to repeat preceding category label as current response is regarded as evidence for order ef...

Pecking Order or Trade-off Hypothesis

In this paper we test the pecking order and trade-off hypotheses of corporate financing decisions using a cross-section of the largest Chinese listed companies. We build on Allen (1993) and Baskin (1989) to set up three models in which trade-off and pecking order theories give distinctively different predictions: (1) the determinants of leverage, (2) the relationship between leverage and divide...