An exploration on the nexus between managers’ present bias and corporate investment

Article

Kim, H. and Nguyen, Q. 2022. An exploration on the nexus between managers’ present bias and corporate investment. Applied Economics Letters. 29 (2), pp. 150-154. https://doi.org/10.1080/13504851.2020.1861186
TypeArticle
TitleAn exploration on the nexus between managers’ present bias and corporate investment
AuthorsKim, H. and Nguyen, Q.
Abstract

This study aims to explore the role of top manager’s present bias as a main driver of corporate investment. For this purpose, we embed an experiment in a firm-level panel survey with a sample of top managers from 623 textile and garment firms in Vietnam. The experiment enables us to elicit present bias for each individual manager. We find that firms led by managers with a greater level of present bias are more likely to have a lower investment. There also exists evidence that the effect of managers’ present bias on corporate investment is stronger for SMEs than for large firms.

KeywordsEconomics and Econometrics
PublisherTaylor & Francis (Routledge)
JournalApplied Economics Letters
ISSN1350-4851
Electronic1466-4291
Publication dates
Online11 Dec 2020
Print19 Jan 2022
Publication process dates
Deposited05 Jan 2021
Accepted25 Nov 2020
Output statusPublished
Accepted author manuscript
Copyright Statement

This is an Accepted Manuscript of an article published by Taylor & Francis in Applied Economics Letters on 11 Dec 2020, available online: http://www.tandfonline.com/10.1080/13504851.2020.1861186

Digital Object Identifier (DOI)https://doi.org/10.1080/13504851.2020.1861186
LanguageEnglish
Permalink -

https://repository.mdx.ac.uk/item/8936v

Log in to edit

Download files

Accepted author manuscript
2020.11.21- AEL-Present bias and investment.pdf

  • 63
    total views
  • 26
    total downloads
  • 2
    views this month
  • 1
    downloads this month

Export as

Related outputs

Linking top managers' behavioural traits with business practices and firm performance
Kim, H. and Nguyen, Q. 2023. Linking top managers' behavioural traits with business practices and firm performance. Review of Managerial Science. https://doi.org/10.1007/s11846-023-00714-0
Demystifying the role of information provision in travellers’ satisfaction: Insights from a randomized controlled trial
Nguyen, Q. and Chang, S. 2023. Demystifying the role of information provision in travellers’ satisfaction: Insights from a randomized controlled trial. Journal of Quality Assurance in Hospitality and Tourism. 25 (6), pp. 1827-1852. https://doi.org/10.1080/1528008X.2023.2201695
Non-financial firms hedging risks in East Asia: the link between financial derivatives use, firm value and exposures to country risks
Kim, T. and Nguyen, Q. 2020. Non-financial firms hedging risks in East Asia: the link between financial derivatives use, firm value and exposures to country risks. in: Goutte, S. and Nguyen, D. (ed.) Handbook of Energy Finance: Theories, Practices and Simulations World Scientific. pp. 595-650
Are time preference and risk preference associated with cognitive intelligence and emotional intelligence?
Ackert, L., Deaves, R., Miele, J. and Nguyen, Q. 2020. Are time preference and risk preference associated with cognitive intelligence and emotional intelligence? Journal of Behavioral Finance. 21 (2), pp. 136-156. https://doi.org/10.1080/15427560.2019.1663850
Promoting adoption of management practices from the outside: insights from a randomized field experiment
Nguyen, Q. and Kim, T. 2019. Promoting adoption of management practices from the outside: insights from a randomized field experiment. Journal of Operations Management. 65 (1), pp. 48-61. https://doi.org/10.1016/j.jom.2018.11.001
Policy uncertainty, derivatives use, and firm-level FDI
Nguyen, Q., Kim, T. and Papanastassiou, M. 2018. Policy uncertainty, derivatives use, and firm-level FDI. Journal of International Business Studies. 49 (1), pp. 96-126. https://doi.org/10.1057/s41267-017-0090-z
Do natural disasters open a window of opportunity for corruption?
Nguyen, Q. 2017. Do natural disasters open a window of opportunity for corruption? The Journal of Development Studies. 53 (1), pp. 156-172. https://doi.org/10.1080/00220388.2016.1187724
Risk and time preferences: linking experimental and household survey data from Vietnam
Tanaka, T., Camerer, C. and Nguyen, Q. 2016. Risk and time preferences: linking experimental and household survey data from Vietnam. in: Ikeda, S., Kato, H., Ohtake, F. and Tsutsui, Y. (ed.) Behavioral Economics of Preferences, Choices, and Happiness Springer, Tokyo. pp. 3-25
Trust under the prospect theory and quasi-hyperbolic preferences: a field experiment in Vietnam
Nguyen, Q., Villeval, M. and Xu, H. 2016. Trust under the prospect theory and quasi-hyperbolic preferences: a field experiment in Vietnam. Economic Development and Cultural Change. 64 (3), pp. 545-572. https://doi.org/10.1086/685434
Linking loss aversion and present bias with overspending behaviour of tourists: insights from a lab-in-the-field experiment
Nguyen, Q. 2016. Linking loss aversion and present bias with overspending behaviour of tourists: insights from a lab-in-the-field experiment. Tourism Management. 54, pp. 152-159. https://doi.org/10.1016/j.tourman.2015.09.019
Revenue targeting in fisheries
Nguyen, Q. and Leung, P. 2013. Revenue targeting in fisheries. Environment and Development Economics. 18 (5), pp. 559-575. https://doi.org/10.1017/S1355770X13000144
Does nurture matter: theory and experimental investigation on the effect of working environment on risk and time preferences
Nguyen, Q. 2011. Does nurture matter: theory and experimental investigation on the effect of working environment on risk and time preferences. Journal of Risk and Uncertainty. 43 (3), pp. 245-270. https://doi.org/10.1007/s11166-011-9130-4
Risk and time preferences: linking experimental and household survey data from Vietnam
Tanaka, T., Camerer, C. and Nguyen, Q. 2010. Risk and time preferences: linking experimental and household survey data from Vietnam. American Economic Review. 100 (1), pp. 557-571. https://doi.org/10.1257/aer.100.1.557
Do fishermen have different attitudes toward risk? An application of prospect theory to the study of Vietnamese fishermen
Nguyen, Q. and Leung, P. 2009. Do fishermen have different attitudes toward risk? An application of prospect theory to the study of Vietnamese fishermen. Journal of Agricultural and Resource Economics. 34 (3), pp. 518-538.
Choice of remuneration regime in fisheries: the case of Hawaii’s longline fisheries
Nguyen, Q. and Leung, P. 2009. Choice of remuneration regime in fisheries: the case of Hawaii’s longline fisheries. Journal of Agricultural and Resource Economics. 34 (3), pp. 498-517.