Review of Managerial Overconfidence and Corporate Acquisition Goodwill Impairment Research - Open Journal of Social Sciences

JSS > Vol.8 No.1, January 2020

Review of Managerial Overconfidence and Corporate Acquisition Goodwill Impairment Research ()

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Download as PDF (Size: 235KB) PP. 121-128

DOI: 10.4236/jss.2020.81010 1,598 Downloads 2,923 Views

Author(s)

Haiting Weng

Affiliation(s)

School of Management, Jinan University, Guangzhou, China.

ABSTRACT

In recent years, the large amount of goodwill impairment caused by high-priced mergers and acquisitions has also aroused widespread discussion. Why do companies purchase at a high premium? What effect does a high premium have on the impairment of goodwill? With the development of behavioral finance, this article uses the perspective of overconfidence in this theory, and answers the above two questions by reviewing the domestic and foreign literature. We find that the overconfidence in management tends to form the overpayment in corporate acquisitions, and the overpayment is more likely to lead to the goodwill impairment. At last, this article also proposes future research directions and I hope it can provide theoretical references for future related research.

KEYWORDS

Managerial Overconfidence, M & A Activities, Goodwill Impairment, M & A Premiums

Share and Cite:

Weng, H. (2020) Review of Managerial Overconfidence and Corporate Acquisition Goodwill Impairment Research. Open Journal of Social Sciences, 8, 121-128. doi: 10.4236/jss.2020.81010.

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