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Managerial overconfidence and M&A performance: evidence from China

Research output: Contribution to journalArticlepeer-review

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Managerial overconfidence and M&A performance: evidence from China. / Guo, Jie Michael; Qian, He; Xin, Jiayuan; Liu, Jia.

In: International Journal of Banking, Accounting and Finance, Vol. 11, No. 3, 07.01.2020, p. 342-360.

Research output: Contribution to journalArticlepeer-review

Harvard

Guo, JM, Qian, H, Xin, J & Liu, J 2020, 'Managerial overconfidence and M&A performance: evidence from China', International Journal of Banking, Accounting and Finance, vol. 11, no. 3, pp. 342-360. https://doi.org/10.1504/IJBAAF.2020.10028269

APA

Guo, J. M., Qian, H., Xin, J., & Liu, J. (2020). Managerial overconfidence and M&A performance: evidence from China. International Journal of Banking, Accounting and Finance, 11(3), 342-360. https://doi.org/10.1504/IJBAAF.2020.10028269

Vancouver

Guo JM, Qian H, Xin J, Liu J. Managerial overconfidence and M&A performance: evidence from China. International Journal of Banking, Accounting and Finance. 2020 Jan 7;11(3):342-360. https://doi.org/10.1504/IJBAAF.2020.10028269

Author

Guo, Jie Michael ; Qian, He ; Xin, Jiayuan ; Liu, Jia. / Managerial overconfidence and M&A performance: evidence from China. In: International Journal of Banking, Accounting and Finance. 2020 ; Vol. 11, No. 3. pp. 342-360.

Bibtex

@article{ce5563fbf38d4e95bc25d4116d31b86c,
title = "Managerial overconfidence and M&A performance: evidence from China",
abstract = "We examine the extent to which managerial overconfidence creates value to acquirers in successful M&As undertaken by Chinese listed firms in the period of 2006-2012. The empirical results show that Chinese acquirers gain value in both the short-run and the long-run after the M&A announcement. Our study provides new evidence that the market responds favourably to M&A deals undertaken by acquirers with more managerial overconfidence in both the short-run and the long-run. Our multivariate analyses, however, show that managerial overconfidence has a minimal role in explaining the stock price movement. In addition, we find that firm size is an important determinant for the relationship between overconfidence and market reaction to merger deals. Taken together, we conclude that managerial overconfidence has little effect in driving merger and acquisition deals in China.",
keywords = "mergers and acquisitions, M&As, market performance, managerial overconfidence, Chinese market, China",
author = "Guo, {Jie Michael} and He Qian and Jiayuan Xin and Jia Liu",
year = "2020",
month = jan,
day = "7",
doi = "10.1504/IJBAAF.2020.10028269",
language = "English",
volume = "11",
pages = "342--360",
journal = " International Journal of Banking, Accounting and Finance",
issn = "1755-3830",
publisher = "Inderscience",
number = "3",

}

RIS

TY - JOUR

T1 - Managerial overconfidence and M&A performance: evidence from China

AU - Guo, Jie Michael

AU - Qian, He

AU - Xin, Jiayuan

AU - Liu, Jia

PY - 2020/1/7

Y1 - 2020/1/7

N2 - We examine the extent to which managerial overconfidence creates value to acquirers in successful M&As undertaken by Chinese listed firms in the period of 2006-2012. The empirical results show that Chinese acquirers gain value in both the short-run and the long-run after the M&A announcement. Our study provides new evidence that the market responds favourably to M&A deals undertaken by acquirers with more managerial overconfidence in both the short-run and the long-run. Our multivariate analyses, however, show that managerial overconfidence has a minimal role in explaining the stock price movement. In addition, we find that firm size is an important determinant for the relationship between overconfidence and market reaction to merger deals. Taken together, we conclude that managerial overconfidence has little effect in driving merger and acquisition deals in China.

AB - We examine the extent to which managerial overconfidence creates value to acquirers in successful M&As undertaken by Chinese listed firms in the period of 2006-2012. The empirical results show that Chinese acquirers gain value in both the short-run and the long-run after the M&A announcement. Our study provides new evidence that the market responds favourably to M&A deals undertaken by acquirers with more managerial overconfidence in both the short-run and the long-run. Our multivariate analyses, however, show that managerial overconfidence has a minimal role in explaining the stock price movement. In addition, we find that firm size is an important determinant for the relationship between overconfidence and market reaction to merger deals. Taken together, we conclude that managerial overconfidence has little effect in driving merger and acquisition deals in China.

KW - mergers and acquisitions

KW - M&As

KW - market performance

KW - managerial overconfidence

KW - Chinese market

KW - China

U2 - 10.1504/IJBAAF.2020.10028269

DO - 10.1504/IJBAAF.2020.10028269

M3 - Article

VL - 11

SP - 342

EP - 360

JO - International Journal of Banking, Accounting and Finance

JF - International Journal of Banking, Accounting and Finance

SN - 1755-3830

IS - 3

ER -

ID: 20503761