Abstract

http://ssrn.com/abstract=2062943
 


 



The Real Effects of Managerial Narratives: Evidence from a Quarter-Billion Words


Art Durnev


University of Iowa - Henry B. Tippie College of Business

Claudine Mangen


Concordia University, Montreal - John Molson School of Business

May 14, 2012


Abstract:     
We show that a firm’s investments are associated with the qualitative content of its rivals’ Management Discussion and Analysis (MD&A) disclosures: a firm invests more when its rivals’ MD&A disclosures are more optimistic. We also find that the sensitivity of a firm’s investments to its rivals’ qualitative MD&A content varies cross-sectionally: the association between the firm’s investments and the optimism in its rivals’ MD&A disclosures is stronger when MD&A disclosures are more certain, rivals are better governed and their industry is less concentrated. We conclude that qualitative MD&A disclosures contain useful information for corporate investments.

Number of Pages in PDF File: 50

Keywords: MD&A, disclosure, investment

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Date posted: May 20, 2012  

Suggested Citation

Durnev, Art and Mangen, Claudine, The Real Effects of Managerial Narratives: Evidence from a Quarter-Billion Words (May 14, 2012). Available at SSRN: http://ssrn.com/abstract=2062943 or http://dx.doi.org/10.2139/ssrn.2062943

Contact Information

Artyom Durnev (Contact Author)
University of Iowa - Henry B. Tippie College of Business ( email )
108 Pappajohn Business Building
Iowa City, IA 52242-1000
United States
(514) 398-5394 (Phone)
(514) 398-3876 (Fax)
HOME PAGE: http://www.artdurnev.com
Claudine Mangen
Concordia University, Montreal - John Molson School of Business ( email )
1450 Guy Street
Montreal, Quebec H3H 0A1
Canada
+ 1(514) 848 24 24 2747 (Phone)
+1 (514) 848 45 18 (Fax)
HOME PAGE: http://jmsb.concordia.ca/~cmangen/
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