 Managements' corporate growth beliefs and M&As – Evidence from ChinaSishi Yue, Keke Wu and Dayong Dong The North American Journal of Economics and Finance, 2023, vol. 68, issue C Abstract: The beliefs held by decision-makers affect their economic behavior. Do beliefs in corporate growth held by listed companies’ management teams affect their execution of mergers and acquisitions (M&As)? We use M&A event data for Chinese Shanghai and Shenzhen A-share listed companies from 2014 to 2021. Words (phrases) related to capital operations in listed companies’ site visit summary reports are employed as a proxy variable for the beliefs in corporate growth held by the management of these companies. We explore the relationship between managers’ beliefs in corporate growth and their M&A activities. The results indicate that the stronger are managers’ beliefs in corporate growth, the more likely these managers are to expand through M&A activities, the more willing they are to pay a premium in M&As and the better their M&A performance is. In addition, beliefs in corporate growth impact the goodwill generated from M&A activities. We provide new empirical evidence from an analysis of the nonrational factors underlying M&A activities. Keywords: Managements; Corporate growth beliefs; M&A; Site visit (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:ecofin:v:68:y:2023:i:c:s1062940823000955 DOI: 10.1016/j.najef.2023.101972 Access Statistics for this article The North American Journal of Economics and Finance is currently edited by Hamid Beladi More articles in The North American Journal of Economics and Finance from Elsevier |
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