Gender, Learning, and Overconfidence: Why Females Create More Accurate Earnings Estimates

63 Pages Posted: 12 Mar 2019

See all articles by Vineet Bhagwat

Vineet Bhagwat

George Washington University - Department of Finance

Sara Shirley

Middle Tennessee State University

Jeffrey Stark

Middle Tennessee State University

Date Written: February 20, 2019

Abstract

We analyze the underlying source of gender differences in earnings estimates on a crowd-sourcing platform with low barriers to entry. This platform allows us to examine gender differences within earnings estimates among a sample of non-professional analysts in an effort to better understand the development of analyst ability. Estimates made by females are more accurate than those made by males. We eliminate explanations of more talented females joining the platform, an innate ability of females to process information, females utilizing more up-to-date information, superior stock selection among females, and survivor ship bias. Rather, our evidence is consistent with females learning faster and males exhibiting greater overconfidence. Our findings provide new insight into the mechanisms behind the increase in accuracy documented among professional female analysts. Finally, we observe a positive market response when females provide more optimistic estimates.

Keywords: gender, learning, overconfidence, earnings forecasts, analysts, Estimize

JEL Classification: G02, M41

Suggested Citation

Bhagwat, Vineet and Shirley, Sara and Stark, Jeffrey, Gender, Learning, and Overconfidence: Why Females Create More Accurate Earnings Estimates (February 20, 2019). Available at SSRN: https://ssrn.com/abstract=3338478 or http://dx.doi.org/10.2139/ssrn.3338478

Vineet Bhagwat (Contact Author)

George Washington University - Department of Finance ( email )

2023 G Street
Washington, DC 20052
United States

Sara Shirley

Middle Tennessee State University ( email )

Murfreesboro, TN 37132
United States

Jeffrey Stark

Middle Tennessee State University ( email )

Murfreesboro, TN
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
103
Abstract Views
885
rank
264,418
PlumX Metrics