TITLE:
Review of Managerial Overconfidence and Corporate Acquisition Goodwill Impairment Research
AUTHORS:
Haiting Weng
KEYWORDS:
Managerial Overconfidence, M & A Activities, Goodwill Impairment, M & A Premiums
JOURNAL NAME:
Open Journal of Social Sciences,
Vol.8 No.1,
January
14,
2020
ABSTRACT: In recent years, the large amount of goodwill impairment caused by
high-priced mergers and acquisitions has also aroused widespread discussion.
Why do companies purchase at a high premium? What effect does a high premium
have on the impairment of goodwill? With the development of behavioral finance,
this article uses the perspective of overconfidence in this theory, and answers the
above two questions by reviewing the domestic and foreign literature. We find
that the overconfidence in management tends to form the overpayment
in corporate acquisitions, and the overpayment is more likely to lead to the goodwill
impairment. At last, this article also proposes future research directions and
I hope it can provide theoretical references for future related research.