Overconfidence and French SME performance
This paper investigates the relationship between entrepreneur overconfidence and French SMEs’ performance. Using a unique dataset linking objective firm financial performance to the individual characteristics and cognitive biases of their owners, we conclude that overestimation is detrimental to ris...
محفوظ في:
| الحاوية / القاعدة: | URI:https://journals.openedition.org/fcs, |
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| المؤلفون الرئيسيون: | , , |
| التنسيق: | Article ou chapitre numérique |
| اللغة: | Anglais |
| منشور في: |
Finance Contrôle Stratégie
2026
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| الموضوعات: | |
| الوصول للمادة أونلاين: | Accès Université d'Orléans et IFPM Accès Université d'Orléans et IFPM |
| الملخص: | This paper investigates the relationship between entrepreneur overconfidence and French SMEs’ performance. Using a unique dataset linking objective firm financial performance to the individual characteristics and cognitive biases of their owners, we conclude that overestimation is detrimental to risk-adjusted firm performance. The opposite effect appears when examining overplacement, which we find to have a positive effect on risk-adjusted firm performance. We do not, however, find a significant link between overprecision and firm performance. Consequently, our findings are important as they show that the crux of the “trouble with overconfidence” (Moore and Healy, 2008) lies in overestimation. |
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