Gender Differences and Executive Financial Decision-Making: Management Earnings Forecasts
2012 American Accounting Association Annual Meeting
Posted: 10 May 2012
Date Written: May 9, 2012
This study examines the effects of gender on executive financial decision-making as it relates to management earnings forecast error. The primary question addressed is: do female and male executives behave differently when issuing management earnings forecasts? Additionally, the following sub-questions are addressed: (1) do female executives issue more accurate earnings forecasts than male executives and (2) are female executives more conservative than male executives when issuing earnings forecasts? Using the executive gender data from listed companies between years 2001-2010, we examine the earnings forecasts made by female and male executives. Our results are consistent with gender structure approach theory indicating significant differences between male and female CEOs/CFOs earnings forecast behaviors are due to executive specific effects rather than gender effects. The additional analysis also demonstrates that female executives are positively associated with cumulated abnormal returns.
Keywords: gender differences, financial decision-making, management earnings forecasts, forecasts errors
JEL Classification: M40, M41, M49, J16
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