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dc.contributor.authorDanso, A.
dc.contributor.authorLartey, T.
dc.contributor.authorAmankwah-Amoah, J.
dc.contributor.authorAdomako, Samuel
dc.contributor.authorLu, Q.
dc.contributor.authorUddin, M.
dc.date.accessioned2019-07-03T08:24:32Z
dc.date.accessioned2019-07-03T13:39:53Z
dc.date.available2019-07-03T08:24:32Z
dc.date.available2019-07-03T13:39:53Z
dc.date.issued2019
dc.identifier.citationDanso A, Lartey T, Amankwah-Amoah J et al (2019) Market sentiment and firm investment decision-making. International Review of Financial Analysis. Accepted for Publication.en_US
dc.identifier.urihttp://hdl.handle.net/10454/17159
dc.descriptionYesen_US
dc.description.abstractWhile research on factors driving corporate investment decisions has blossomed, knowledge related to the Chief Executive Officer’s (CEO’s) market sentiment on investment decision outcomes is lacking. In this study, we extend the existing corporate finance literature by examining the underexplored issue of how CEOs’ market sentiment drives firms’ investment decisions. Capitalising on a large sample of US firms for the period 2004-2014, we uncovered some crucial observations. First, we found empirical support for our theoretical contention that market sentiment drives corporate investment decisions. Second, we established that, while financial flexibility induces managers to overinvest, the expectation of future profitability leads firms to underinvest during high sentiment periods. In addition, we uncovered that the 2007/08 financial crisis significantly impacted firm behaviour and realigned managerial decision-making. Thus, the sentiment-investment relationship is more pronounced during the crisis and the post-crisis periods. Our results are robust after accounting for the possibility of endogeneity and using alternative measures of both CEOs’ market sentiment and firm investment.en_US
dc.language.isoenen_US
dc.publisherElsevier
dc.relation.isreferencedbyhttps://doi.org/10.1016/j.irfa.2019.06.008
dc.rights© 2019 Elsevier Inc. All rights reserved. Reproduced in accordance with the publisher's self-archiving policy. This manuscript version is made available under the CC-BY-NC-ND 4.0 license.
dc.subjectMarket sentimenten_US
dc.subjectInvestmenten_US
dc.subjectProfitabilityen_US
dc.subjectFlexibilityen_US
dc.subjectCrisisen_US
dc.titleMarket sentiment and firm investment decision-makingen_US
dc.status.refereedYesen_US
dc.date.Accepted2019-06-30
dc.date.application2019-07-04
dc.typeArticleen_US
dc.date.EndofEmbargo2021-01-05
dc.type.versionAccepted manuscripten_US
dc.description.publicnotesThe full-text of this article will be released for public view at the end of the publisher embargo 5 Jan 2021.en_US
dc.date.updated2019-07-03T07:24:35Z
refterms.dateFOA2019-07-03T13:40:25Z


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