Overconfidence, Investment Policy, and Executive Stock Options

115 citations recorded by the source corpus.

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

Beyond hubris: How highly confident entrepreneurs rebound to venture again☆ (2010, background): “Stakeholders who are drawn to high variance outcomes may especially value such decisiveness, relative to the hesitancy of more risk-averse entrepreneurs who exhibit greater caution in acting on promises (Gervais et al., 2004).”
CEO overconfidence, CEO dominance and corporate acquisitions (2007, background): “Importantly, both objections are weaker in a corporate finance setting than in the setting of financial markets (Heaton, 2002; Gervais et al., 2003).”
True Overconfidence: The Inability of Rational Information Processing to Account for Apparent Overconfidence (2011, unknown): “…Weber, 2007; Odean, 1998), to the emergence of stock market bubbles (Scheinkman and Xiong, 2003; Shiller, 2002), to corporate investment decisions (Gervais, Heaton, and Odean, 2003; Malmendier and Tate, 2005), and to the predictability of market returns (Daniel, Hirshleifer, and Subrahmanyam,…”
A Hubris Theory of Entrepreneurship (2006, background): “In a related study, Gervais et al. (2004) argue that because overconfident managers underestimate risk, they persistently overcome the propensity of risk-averse rational managers to delay projects that are in shareholders’ best interests.”