GOEL, ANAND M.; THAKOR, ANJAN V. - In: Journal of Finance 63 (2008) 6, pp. 2737-2784
We develop a model that shows that an overconfident manager, who sometimes makes value-destroying investments, has a higher likelihood than a rational manager of being deliberately promoted to CEO under "value-maximizing" corporate governance. Moreover, a risk-averse CEO's overconfidence...