Peer effects in decision-making: Evidence from corporate investment

Artikel

We show that peer effects influence corporate investment decisions. Using a sample of China's listed firms from 1999 to 2012, we show that a one standard deviation increase in peer firms' investments is associated with a 4% increase in firm i's investments. We further identify the mechanisms, conditions and economic consequences of peer effects in firms' investment decisions. We find that peer effects are more pronounced when firms have information advantages and the information disclosure quality of peer firms is higher, or if they face more fierce competition. When firms are industry followers, are young or have financial constraints, they are highly sensitive to their peers firms. We also quantify the economic consequences generated by peer effects, which can increase firm performance in future periods.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: China Journal of Accounting Research ; ISSN: 1755-3091 ; Volume: 10 ; Year: 2017 ; Issue: 2 ; Pages: 167-188 ; Amsterdam: Elsevier

Classification and Topics

• Classification: Management
• Subject: Peer effects ; Corporate investment ; Managerial learning ; Peer effects ; Corporate investment ; Managerial learning

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Chen, Shenglan ; Ma, Hui
• Event: Veröffentlichung
• (who): Elsevier
• (where): Amsterdam
• (when): 2017

Further information

• DOI: doi:10.1016/j.cjar.2016.11.002
• Handle: http://hdl.handle.net/10419/187672
• Last update: 10.03.2025, 11:41 AM CET