Manager Perception and Proprietary Investment Disclosure

49 Pages Posted: 7 Aug 2018 Last revised: 12 Feb 2021

See all articles by Caleb Rawson

Caleb Rawson

University of Arkansas - Department of Accounting

Date Written: February 11, 2021


This paper investigates the role of manager perception in proprietary disclosure decisions. I find robust evidence that firms with overconfident CEOs (managers who are more likely to perceive proprietary costs to be lower) provide significantly more narrative R&D disclosures than firms without overconfident CEOs. In cross-sectional analysis, I find that this result is driven by observations where proprietary costs are more significant and salient. Consistent with R&D disclosures being proprietary, I find that the return on R&D is significantly lower when firms have more R&D disclosure and that this relation is not impacted by the presence of an overconfident CEO except through higher R&D disclosure. Finally, I find no association between having an overconfident CEO and non-proprietary disclosure. Collectively, these results suggest that manager perception of proprietary costs is an important determinant of firms’ voluntary proprietary disclosure.

Keywords: Voluntary Disclosure, Overconfidence, Proprietary Information, R&D

JEL Classification: M10, M41, G30

Suggested Citation

Rawson, Caleb, Manager Perception and Proprietary Investment Disclosure (February 11, 2021). Available at SSRN: or

Caleb Rawson (Contact Author)

University of Arkansas - Department of Accounting ( email )

Business Bldg. 454
Fayetteville, AR 72701
United States

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