Managerial ability and investment to price sensitivity

被引:3
作者
Shen, Jianghua [1 ,2 ]
Xie, Lingmin [3 ]
机构
[1] Xiamen Univ, Dept Accounting, Xiamen, Peoples R China
[2] Xiamen Univ, Ctr Accounting Studies, Xiamen, Peoples R China
[3] Shenzhen Univ, Coll Econ, Shenzhen, Peoples R China
关键词
Managerial ability; Investment-to-price sensitivity; Managerial learning; Market feedback; CASH FLOW; STOCK-PRICE; MEASUREMENT ERROR; INFORMATION; MARKET; DISCLOSURE; RISK; OPPORTUNITIES; COMPETITION; LEVERAGE;
D O I
10.1016/j.iref.2023.07.024
中图分类号
F8 [财政、金融];
学科分类号
0202 ;
摘要
This paper investigates how managerial ability influences their incentives to learn from stock prices, as measured by investment-q sensitivity. Our findings indicate a negative association between managerial ability and investment-q sensitivity. This relationship is more pronounced when firms' stock prices contain less investors' private information. However, we do not find similar results using non-price-based measures of investment opportunities. Collectively, the re-sults suggest that high-ability managers learn less information from stock prices when making investment decisions. To mitigate the endogeneity concern, we adopt chief executive officer (CEO) turnover as an exogenous shock to CEO ability and find consistent results. Additionally, we show that high-ability managers have more private information, suggesting that there is less information to be learned from stock prices.
引用
收藏
页码:928 / 941
页数:14
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