Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/311763 
Year of Publication: 
2022
Citation: 
[Journal:] Review of Managerial Science [ISSN:] 1863-6691 [Volume:] 17 [Issue:] 7 [Publisher:] Springer [Place:] Berlin, Heidelberg [Year:] 2022 [Pages:] 2297-2324
Publisher: 
Springer, Berlin, Heidelberg
Abstract: 
We use a unique panel data set of private German firms to analyze the relation between managerial overconfidence and investment policy in small and medium-sized firms. We find that overconfident managers invest more, and that this relation is driven by expansion investments. When considering the outcome of investment projects, we find that projects initiated by overconfident managers are less likely to be completed as planned. When we differentiate between three types of non-completion (downsizing, delaying, and abandoning), we find that overconfident managers are more likely to delay, rather than to abandon or downsize a project.
Subjects: 
Overconfidence
Small and medium-sized enterprises
Corporate investment
Private companies
JEL: 
G31
G32
O16
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

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