No reliance on guidance: counter‐signaling in management forecasts.
This study presents and provides an explanation for a novel stylized fact: both high‐performing and troubled companies withhold issuing earnings guidance. We assume that the manager's ability affects the level of earnings and the accuracy of guidance, but issuing a forecast is costless for all manag...
| Publicado en: | RAND Journal of Economics (Wiley-Blackwell) Vol. 52; no. 1; pp. 207 - 246 |
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| Autores principales: | , , |
| Formato: | Artículo |
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Wiley-Blackwell
Mar2021
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| Materias: | |
| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=149571845&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 149571845 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 07416261 56RJ jtl: RAND Journal of Economics (Wiley-Blackwell) issn: 07416261 maglogo: Y pubinfo: dt: Mar2021 vid: 52 iid: 1 pid: 480 pub: Wiley-Blackwell artinfo: ui: 149571845 10.1111/1756-2171.12367 ppf: 207 ppct: 39 formats: fmt: – @attributes: type: T – @attributes: type: C – @attributes: type: P size: 689KB tig: atl: No reliance on guidance: counter‐signaling in management forecasts. aug: au: Aghamolla, Cyrus Corona, Carlos Zheng, Ronghuo affil: University of Minnesota Ohio State University University of Texas at Austin su: Forecasting Ability sug: subj: Forecasting Ability ab: This study presents and provides an explanation for a novel stylized fact: both high‐performing and troubled companies withhold issuing earnings guidance. We assume that the manager's ability affects the level of earnings and the accuracy of guidance, but issuing a forecast is costless for all manager types. Managers are thus able to signal their ability through accuracy in their forecasts. While high ability managers would seem to benefit the most from issuing guidance, in equilibrium we find that both high and low ability managers withhold issuing guidance, while intermediate types forecast. Hence, high ability managers counter‐signal in equilibrium, which does not result in a subsequent "punishment" by the market. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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