Proceedings of the 1st Africa-Asia Dialogue Network (AADN) International Conference (AADNIC 2019)

Research on Manager’s Overconfidence and Enterprise Financial Dilemma: A Case Analysis Based on LeEco company

Authors
Meijuan Zou, Wenwen Wu
Corresponding Author
Meijuan Zou
Available Online 12 October 2020.
DOI
10.2991/assehr.k.201012.003How to use a DOI?
Keywords
LeEco, Overconfidence of managers, Financial difficulties
Abstract

Most business managers will overestimate their abilities, have greater confidence in the business situation of enterprises, easily overestimate investment returns and underestimate the risks in operation. Such overconfidence will easily lead to radical financial decisions and increase the probability of enterprises falling into financial difficulties. This paper takes the former Star Enterprise LeEco Company as the research object. From the perspective of managers’ overconfidence, it takes managers’ investment and financing behavior as intermediary variable to explore how managers’ overconfidence affects and causes enterprises to fall into financial distress. It is found that managers’ overconfidence will make enterprises tend to over-investment and prefer debt financing, and then increase the financial risk of enterprises, and make enterprises fall into financial difficulties.

Copyright
© 2020, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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Volume Title
Proceedings of the 1st Africa-Asia Dialogue Network (AADN) International Conference (AADNIC 2019)
Series
Advances in Social Science, Education and Humanities Research
Publication Date
12 October 2020
ISBN
978-94-6239-169-7
ISSN
2352-5398
DOI
10.2991/assehr.k.201012.003How to use a DOI?
Copyright
© 2020, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Cite this article

TY  - CONF
AU  - Meijuan Zou
AU  - Wenwen Wu
PY  - 2020
DA  - 2020/10/12
TI  - Research on Manager’s Overconfidence and Enterprise Financial Dilemma: A Case Analysis Based on LeEco company
BT  - Proceedings of the 1st Africa-Asia Dialogue Network (AADN) International Conference (AADNIC 2019)
PB  - Atlantis Press
SP  - 14
EP  - 19
SN  - 2352-5398
UR  - https://doi.org/10.2991/assehr.k.201012.003
DO  - 10.2991/assehr.k.201012.003
ID  - Zou2020
ER  -