negative effect on profit. Overconfidence, on the contrary, reduces incentive pay as shown by the previous literature, while …We analyze the effects of optimism and overconfidence when the manager's compensation package includes severance pay … its effect on severance pay depends on the intensity of the bias. High values of overconfidence yield an inefficient level …

between CEO incentive compensation and CEO overconfidence.Design/methodology/approach – This empirical study performs random … and fixed effects regression analysis. It uses option-implied measures of CEO overconfidence. Findings – The authors … high CEO incentive compensation and CEO overconfidence is associated with an increase in corporate risk of approximately 6 …

We provide a preference-based rationale for endogenous overconfidence. Horizon-dependent risk aversion, combined with a … possibility to forget, can generate overconfidence and excessive risk taking in equilibrium. An "anxiety prone" agent, who is more … results to the literature on empirically observed overconfidence and excessive risk taking in several domains of financial and …

, this effect occurs in industries where investor trust has recently been violated, and where managers would in the past have …