Weakening Effect of Executive Overconfidence on Equity Incentive—The Empirical Evidence from Chinese Listed Companies

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DOI: 10.4236/ojbm.2019.71011    1,013 Downloads   1,801 Views  Citations
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ABSTRACT

The paper takes Chinese listed companies from 2010 to 2016 as samples, to examine the relationship between executive overconfidence and equity incen-tive. Results show that executive overconfidence has a significant weakening effect on equity compensation incentives (including stock options and re-stricted stocks), that is, compared with rational executives, the company will reduce the equity incentives for overconfident executives.

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Chen, S. (2019) Weakening Effect of Executive Overconfidence on Equity Incentive—The Empirical Evidence from Chinese Listed Companies. Open Journal of Business and Management, 7, 151-166. doi: 10.4236/ojbm.2019.71011.

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