The Relationship between Overconfidence and the Introduction of Risky Products: Evidence from a Field Study

By M. Simon, Susan M. Houghton. 2003

434 citations recorded by the source corpus.

Subfields: Accounting

View Paper: https://www.semanticscholar.org/paper/fda2acec37ab169637e1de1a1de1e3f91b884cc0

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In Accounting

1. Yi Tang
2. Jiatao Li
3. R. Hoskisson
4. J. Zyung
5. Eni Gambeta
6. Hongyan Yang
7. Gavin Cassar
8. R. Trevelyan

Citations in the corpus

• Beyond hubris: How highly confident entrepreneurs rebound to venture again☆ (2010, background): “In particular, some theory and evidence suggests that overconfidence has predictable effects on key strategic outcomes, including over-entry into newmarkets (Camerer and Lovallo,1999) over-investment and commitment to risky, new projects and assets (Hayward and Hambrick, 1997; Simon and Houghton, 20”
• The Origin of Failure: A Multidisciplinary Appraisal of the Hubris Hypothesis and Proposed Research Agenda (2014, background): “Although the meaning of hubris is quite easy to grasp, only a handful of studies (Ben-David, Graham, & Harvey, 2007; Li & Tang, 2010; Simon & Houghton, 2003; Tang, Li, & Yang, 2012) have used surveys to directly assess CEO overconfidence and excessive pride (see Table 1).”
• Entrepreneurial actions and optimistic overconfidence: The role of motivated reasoning in new product introductions (2012, background): “This in turn allows for the possibility of overconfidence (Simon and Houghton, 2003).”
• Effects of Attribute Framing on Cognitive Processing and Evaluation (2004, background): “Regarding level of confidence, dozens of laboratory studies have documented the prevalence of too much confidence in judgment, i.e., decision makers certainty that their predictions are correct most often exceeds the accuracy of those predictions (Simon & Houghton, 2003).”
• The influence of CEO demographic characteristics on corporate risk-taking: evidence from Chinese IPOs (2016, background): “Similarly, Simon and Houghton (2003) find a positive relationship between directors’ overconfidence and corporate risk-taking.”
• What Makes Entrepreneurs Happy? Determinants of Satisfaction Among Founders (2012, background): “In addition, managers who introduce pioneering products tend to be more overoptimistic than those who pursue incremental innovations (Simon and Houghton 2003), diminishing subsequent entrepreneurial satisfaction.”
• The Study of Bias in Entrepreneurship (2017, background): “We need to note that all aforementioned relationships between contextual factors and overconfidence in entrepreneurship treat overconfidence exclusively as “overestimation” (Hayward et al., 2006; Simon & Houghton, 2003; Simon & Shrader, 2012; Zacharakis & Shepherd, 2001).”
• Untangling the Effects of Overexploration and Overexploitation on Organizational Performance: The Moderating Role of Environmental Dynamism† (2008, background): “For example, Simon and Houghton (2003) examined a sample of high-technology firms and found that overconfidence was positively related to the degree to which product introductions were pioneering or risky when, in fact, these products were less likely to achieve success.”
• Developing Leaders for Decision Making Under Stress: Wildland Firefighters in the South Canyon Fire and Its Aftermath (2005, background): “Simon and Houghton (2003), for instance, examined confidence among product managers of small computer software and hardware firms when they introduced radically new products to the market.”