Behavioural corporate finance / by Júlio Lobão.

Format:

Book

Author/Creator:

Lobão, Júlio, author.

Language:

English

Subjects (All):

Executives--Psychology.

Executives.

Corporations--Finance--Psychological aspects.

Corporations.

Physical Description:

1 online resource (207 p.)

Edition:

1st ed.

Place of Publication:

Newcastle upon Tyne, England : Cambridge Scholars Publishing, 2016.

Summary:

Orthodox financial theory often ignores the role played by managers' personal characteristics in their decision-making processes. However, as anyone with experience in the business world knows, managers' personalities are crucial in the choices they make. Indeed, it should be noted that firms do not make decisions, rather it is the managers who decide - either as a group or individually.This book explores the impact of managers' psychological profiles and life experiences on their financial decisions, taking the following key questions as starting points: Why do they commit mistakes? Why do th

Contents:

Intro

Table of Contents

Part I - The Decision of the Manager

Chapter One

1.1. Management Errors in Financial Theory

1.2. Behavioural Finance in the Firm

1.3. Book Layout

Notes

Chapter Two

2.1. A Biased Mind

a) Framing Effects

b) Violation of the Dominance Principle

c) Loss Aversion

2.2. Overconfidence

a) Introduction

b) Overconfident Managers

c) Management Overconfidence Over Time

d) Sources of Overconfidence

e) Measuring Managers' Overconfidence

2.3. The Planning Fallacy and Scenario Thinking

2.4 Other Decision biases

a) Confirmation bias

b) Anchoring bias

c) Availability bias

d) Cognitive Dissonance

e) Illusion of Control

Chapter Three

3.1. Introduction

3.2. Empirical Evidence

3.3. Financial Decisions in a Group

3.4. Improving Group Decisions

Chapter Four

4.1. Learning

4.2. Competition

4.3. Incentives

Chapter Five

Chapter Six

6.1. Introduction

6.2. Empirical Evidence

6.3. Managers' Personality and Institutional Factors

Chapter Seven

Part II - Financial Decisions in Organisations

Chapter Eight

8.1. Introduction

8.2. The Manager and the Investment

a) Investment and the Company's Internal Financial Resources

b) Reluctance to Disinvest and the Escalation of Commitment

c) Implications for Corporate Governance

Chapter Nine

9.1. Introduction

9.2. The Manager and the Financing Decisions

a) Differences of Opinion between Managers and Shareholders

b) Managerial Overconfidence

Chapter Ten

10.1. Introduction

10.2. Investors and Dividend Demand

10.3. Managers and Dividend Supply

a) Managers' Surveys

b) Managers' Behavioural Motivation

Chapter Eleven

11.1. Introduction.

11.2. Managerial Overconfidence

11.3. Other Behavioural Factors that affect the Manager

11.4. Behavioural Effects Resulting from the Negotiation Process

a) The "Competitive Arousal

b) The Manager's Overcommitment

11.5. The Manager's Opposition to a Merger or Acquisition

11.6. Corporate Governance Implications

a) Reducing the Manager's Overconfidence

b) Mitigating the "Competitive Arousal

c) Mitigating the Manager's Overcommitment

Chapter Twelve

12.1. Capital Budgeting Decisions

12.2. Financing Decisions

a) The Moment to Issue Shares

b) Results from Managers Surveys

c) The Impact of Market Timing in the Firms' Capital Structure

d) Profitability after Share Issuance

12.3. Dividends

12.4. Mergers and Acquisitions

12.5. Other Decisions

a) Stock splits

b) Corporate Name Changes

Chapter Thirteen

a) Capital Budgeting

b) Financing

c) Mergers and Acquisitions

Chapter Fourteen

14.1. Organisational Culture

14.2. Decision Biases in the Culture of the Organisation

14.3. Information Manipulation and Fraud

Chapter Fifteen

Appendix A

Bibliography

Index.

Notes:

Description based upon print version of record.

Includes bibliographical references and index.

Description based on online resource; title from PDF title page (ebrary, viewed June 20, 2016).

ISBN:

1-4438-8741-2

OCLC:

935642534