Reputation, Incentives, and Managerial Decision

THE NEW PALGRAVE DICTIONARY OF MONEY AND FINANCE, Ch. 26, pp. 332-337, 1992

Posted: 5 Oct 2008 Last revised: 19 Oct 2008

See all articles by David A. Hirshleifer

David A. Hirshleifer

University of California, Irvine - Paul Merage School of Business; NBER

Abstract

This paper reviews the biases induced by managers' incentives to build his reputation or that of his firm and the resulting distortions in investment and operating decisions. This essay argues that reputation incentives can influence the initiation and termination of projects, the degree of conservatism, the timing of resolution of uncertainty and of cash flows, and conformist versus deviant behavior.

Suggested Citation

Hirshleifer, David A., Reputation, Incentives, and Managerial Decision. THE NEW PALGRAVE DICTIONARY OF MONEY AND FINANCE, Ch. 26, pp. 332-337, 1992. Available at SSRN: https://ssrn.com/abstract=1278645

David A. Hirshleifer (Contact Author)

University of California, Irvine - Paul Merage School of Business ( email )

Irvine, CA California 92697-3125
United States

HOME PAGE: http://sites.uci.edu/dhirshle/

NBER ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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