The Relationship Research On Manager's Overconfidence?Debt Financing Strategy And Enterprise Value

The traditional financial theory is based on the assumption of 'rational man',it is believed that managers can make financial decisions rationally to maximize the enterprise value.A lot of cognitive psychology researches showed that people cannot be completely rational in making decisions.Based on this,it allowed scholars to loose the assumptions of rational people,and introduce the psychological factors of managers into financial theory.Hence the theory of behavioral finance was established.Psychologists believe that people are overconfident,especially those overconfidence in their judgment of knowledge accuracy,will underestimate certain types of information and overestimate other information.There is a strong and significant presence of overconfidence,scholars have introduced the characteristics of overconfidence of managers into the research on the financial decisions and enterprise value of enterprises.This paper starts from the influence of overconfidence on corporate debt financing strategy and enterprise value,and use the method of combining normative research with empirical research to carry out the whole research.Normative research was based on the previous scholars'researches,and we also sort out the relationship between overconfidence of managers and the level of corporate debt,debt financing strategy and enterprise value.Academics agree that overconfident managers prefer the debt financing,but whether overconfident managers prefer short-term liabilities or long-term liabilities is still a controversy.In terms of enterprise value,overconfident managers have yet to reach a consensus on whether the impact on corporate value is good or bad.This paper verifies the influence of overconfidence on the debt financing strategy and enterprise value of listed companies in China,choosing the manager's personal characteristics as an alternative to overconfidence,and in order to ensure the continuity and stability of individual characteristic variables,we select A company that has not changed the CEO of a-share listed companies in Shanghai and Shenzhen in 2010-2014 to conduct empirical research on the research samples,the statistical methods of descriptive statistical analysis,correlation analysis,multiple regression analysis and robustness analysis were carried out in the sample data.Through normative analysis and empirical analysis,this paper draws the following conclusions:(1)overconfident managers(no professional background,no academic background,or both)prefer debt financing;(2)overconfident managers(men,no academic backgrounds,or both)prefer short-term debt;(3)terms of enterprise value,overconfident managers(male and both)can promote the promotion of enterprise value;on the other hand,overconfident managers(younger,less academic)have damaged enterprise value.(4)overconfident managers(gender,academic background,and both)have an impact on corporate value through corporate debt policies.