Does managerial myopia promote enterprises over-financialization? Evidence from listed firms in China
This paper analyzes the potential shortsightedness of enterprise managers through annual reports. Additionally, we use corporate financial statement data to measure enterprises over-financialization in terms of resource allocation. After testing with a causal inference model, we find that firms with managerial myopia significantly contribute to over-financialization. It remains robust even after the instrumental variable of whether the manager has experienced a famine is used. Furthermore, financial distress and financing constraints amplify the inclination of short-term-focused managers to amass greater financial assets.
Authors
- Yanchi Chen
- Qi Shi (ORCID: https://orcid.org/0000-0002-7532-5489)
- Ye Ju (ORCID: https://orcid.org/0009-0004-4244-8804)
Institutions
- Nanjing University of Finance and Economics (CN)
Publication Details
- Journal
- PLoS ONE
- Published
- 2024-09-05
- DOI
- https://doi.org/10.1371/journal.pone.0309140
- Citations
- 4
- Primary Topic
- Housing, Finance, and Neoliberalism
- Type
- article
- Field-Weighted Citation Impact
- 2.16
Funders
- Nanjing University
- Nanjing University of Finance and Economics
- National Office for Philosophy and Social Sciences
- National Social Science Fund of China