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When there is uncertainty about a CEO's quality, news about the firm causes rational investors to update their expectation of the firm's profitability for two reasons: Updates occur because of the direct effect of the news, and also because the news can cause an updated assessment of the CEO's...
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When there is uncertainty about a CEO's quality, news about the firm causes rational investors to update their expectation of the firm's profitability for two reasons: Updates occur because of the direct effect of the news, and also because the news can cause an updated assessment of the CEO's...
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growth using the cross-section of signals. The uncertainty (confidence measure) about investor's growth expectations, as in … the data, is time-varying and subject to large moves. The fluctuations in confidence measure affect the distribution of …
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