期刊論文
| 學年 | 112 |
|---|---|
| 學期 | 1 |
| 出版（發表）日期 | 2023-11-03 |
| 作品名稱 | CEO overconfidence, risk-taking, and firm value: Influence of incentive compensation and financial constraints |
| 作品名稱（其他語言） | |
| 著者 | Hui-Wen Tang; Chong-Chuo Chang |
| 單位 | |
| 出版者 | |
| 著錄名稱、卷期、頁數 | The North American Journal of Economics and Finance |
| 摘要 | By using the data of firms listed on the three major US stock exchanges—the New York Stock Exchange, Nasdaq Stock Exchange, and American Stock Exchange—this study investigated (1) whether CEO overconfidence increases additional risk-taking and affects firm value, (2) whether high incentive compensation for overconfident CEOs increases additional risk-taking behavior and firm value, and (3) whether financial constraints reduce overconfident CEOs’ additional risk-taking and firm value. Our empirical results reveal significant differences in the variable data between the subsamples of firms with an overconfident CEO versus and those with a non-overconfident CEO. The firms with an overconfident CEO had more additional risk-taking, higher firm value, and more financial constraints than those with a non-overconfident CEO did. CEO overconfidence had significant positive associations with additional risk-taking and firm value, indicating that CEO overconfidence has a positive effect on firm overinvestment. Although overconfidence sometimes distorts investment decisions, it also leads to risky but valuable investments. Offering incentive compensation can incentivize CEOs to engage in additional risk-taking behaviors that increase firm value. This result indicates that offering a greater amount of incentive compensation encourages CEOs to take additional risks because they can gain higher compensation from making valuable investments that increase their firm’s value. In this study, incentive compensation was more likely to motivate risk-taking leading to increase firm value in non-overconfident CEOs than in overconfident CEOs. That is, granting non-overconfident CEOs a high percentage of incentive compensation can align their interests with those of shareholders and encourage more rational risk-taking. Compared with firms with overconfident CEOs, those with non-overconfident CEOs that were subject to higher financial constraints exhibited a less significant decrease in additional risk-taking but a more significant decrease in firm value. |
| 關鍵字 | overconfidence;risk-taking;firm value;incentive compensation;financial constraints. |
| 語言 | en |
| ISSN | 1879-0860;1062-9408 |
| 期刊性質 | 國外 |
| 收錄於 | SSCI |
| 產學合作 | |
| 通訊作者 | Hui-wen Tang |
| 審稿制度 | 是 |
| 國別 | NLD |
| 公開徵稿 | |
| 出版型式 | ,電子版,紙本 |
| 相關連結 |
機構典藏連結 ( http://tkuir.lib.tku.edu.tw:8080/dspace/handle/987654321/124733 ) |