Journal article
CEO Overconfidence and Earnings Management: Evidence from Property-Liability Insurers' Loss Reserves
North American actuarial journal, Vol.22(3), pp.380-404
07/03/2018
DOI: 10.1080/10920277.2017.1421977
Abstract
This study investigates the relation between managerial overconfidence and loss-reserving practices in the U. S. property-liability insurance industry. We find robust evidence that CEO overconfidence is significantly associated with relatively low loss reserves, resulting in relatively high reported earnings. This finding is consistent with the theoretical predication that overconfident managers overestimate the returns on their investment projects and underestimate losses. Our result contributes to the literature linking CEOs' personality traits and firms' accounting policy as well as to the literature on insurer loss-reserving practices.
Details
- Title: Subtitle
- CEO Overconfidence and Earnings Management: Evidence from Property-Liability Insurers' Loss Reserves
- Creators
- Thomas R. Berry-Stolzle - University of IowaEvan M. Eastman - Florida State UniversityJianren Xu - University of North Texas
- Resource Type
- Journal article
- Publication Details
- North American actuarial journal, Vol.22(3), pp.380-404
- Publisher
- Taylor & Francis
- DOI
- 10.1080/10920277.2017.1421977
- ISSN
- 1092-0277
- eISSN
- 2325-0453
- Number of pages
- 25
- Grant note
- TriStar Risk Management Fellowship
- Language
- English
- Date published
- 07/03/2018
- Academic Unit
- Finance
- Record Identifier
- 9984380394802771
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