CEO overconfidence's impact on the firm : an empirical study

• Main Authors: Nguyen, Quoc Huy, Sabiyutheen, Soh, Ye Chao
• Other Authors: Sen, Nilanjan
• Format: Final Year Project
• Published: 2008
• Subjects: DRNTU::Business::Management::Leadership
• Online Access: http://hdl.handle.net/10356/10415
• Institution: Nanyang Technological University

We propose that overconfident CEOs have negative impact on firm’s performance measured by ROA and ROE. They also negatively affect the value of the firm calculated by Tobin’s Q. In addition, they prefer high leverage by the use of debts. Nevertheless, when they have a dominant role within the firm, they still can improve firm’s value better than the overconfident but not dominant CEOs, even though there is no significant improvement in firm performance.