Managerial overconfident and firm financing decision: an Indonesian case

DOI

10.2991/insyma-18.2018.18How to use a DOI?

Keywords

Financing decision, behavioral finance, managerial overconfidence, firm characteristics

Abstract

This research aims to determine the effect of managerial overconfidence and firm characteristics on financing decision of a firm. This research uses panel data from the entire companies listed on Indonesia Stock Exchange (BEI), except financial industry within 2006 - 2015. The result showed the higher the confidence of an executive, judged by the profile photo, the smaller the debt used by the firm (1); the higher the past performance of a ratio, measured from the cash flow on operational activity to total asset, the lower the debt used by the firm (2). Higher education level of the executive tends to increase the usage of debt by the firm (3); The past working experience of a CEO will make him able to face many situations using the available information and it is likely to be unbiased (4). Finally, gender does not have a significant effect on the size of the debt in a firm.

Copyright

© 2018, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Werner Ria Murhadi
PY  - 2018/03
DA  - 2018/03
TI  - Managerial overconfident and firm financing decision: an Indonesian case
BT  - Proceedings of the 15th International Symposium on Management (INSYMA 2018)
PB  - Atlantis Press
SP  - 71
EP  - 75
SN  - 2352-5398
UR  - https://doi.org/10.2991/insyma-18.2018.18
DO  - 10.2991/insyma-18.2018.18
ID  - RiaMurhadi2018/03
ER  -