Using an agency theory framework, we examine the effect of managerial overconfidence on the interaction between planning and control problems. We consider a typical setting in which a manager makes an investment decision involving project selection and a production decision to implement the...

We examine the impact of biases in managerial judgment and in accounting reports on the disclosure of unverifiable private managerial information for stewardship purposes. We show that any biased managerial judgment in interpreting private information, and negatively biased accounting...

We investigate how board expertise affects CEO incentives and firm value. The CEO engages in a sequence of tasks: first acquiring information to evaluate a potential project, then reporting his assessment of the project to the board, and finally implementing the project if it is adopted. We...