In-Group Bias in Financial Markets

Published Online:https://doi.org/10.1287/mnsc.2023.01467

References

  • Adams RB (2016) Women on boards: The superheroes of tomorrow? Leadership Quart. 27(3):371–386.CrossrefGoogle Scholar
  • Agrawal A, Chadha S, Chen MA (2006) Who is afraid of Reg FD? The behavior and performance of sell- side analysts following the SEC’s fair disclosure rules. J. Bus. 79(6):2811–2834.CrossrefGoogle Scholar
  • Aspinall P, Song M (2013) Is race a ‘salient…’ or ‘dominant identity’ in the early 21st century: The evidence of UK survey data on respondents’ sense of who they are. Soc. Sci. Res. 42(2):547–561.CrossrefGoogle Scholar
  • Bandiera O, Prat A, Hansen S, Sadun R (2020) CEO behavior and firm performance. J. Political Econom. 128(4):1325–1369.CrossrefGoogle Scholar
  • Bennedsen M, Pérez-González F, Wolfenzon D (2020) Do CEOs matter? Evidence from hospitalization events. J. Finance 75(4):1877–1911.CrossrefGoogle Scholar
  • Bhushan R (1989) Firm characteristics and analyst following. J. Accounting Econom. 11(2–3):255–274.CrossrefGoogle Scholar
  • Brennan MJ, Hughes PJ (1991) Stock prices and the supply of information. J. Finance 46(5):1665–1691.CrossrefGoogle Scholar
  • Brewer MB, Weber J (1994) Self-evaluation effects of interpersonal versus intergroup social comparison. J. Personality Soc. Psych. 66(2):268–275.CrossrefGoogle Scholar
  • Cameron AC, Miller DL (2015) A practitioner’s guide to cluster-robust inference. J. Human Resources 50(2):317–372.CrossrefGoogle Scholar
  • Cen L, Hilary G, Wei KCJ (2013) The role of anchoring bias in the equity market: Evidence from analysts’ earnings forecasts and stock returns. J. Financial Quant. Anal. 48(1):47–76.CrossrefGoogle Scholar
  • Chhaochharia V, Kumar A, Zhang S (2023) Gender-performance relation in competitive but supportive work environments: Evidence from Wall Street. Preprint, submitted June 21, https://dx.doi.org/10.2139/ssrn.4478781.Google Scholar
  • Clement MB, Tse SY (2003) Do investors respond to analysts’ forecast revisions as if forecast accuracy is all that matters? Accounting Rev. 78(1):227–249.CrossrefGoogle Scholar
  • Clement MB, Tse SY (2005) Financial analyst characteristics and herding behavior in forecasting. J. Finance 60(1):307–341.CrossrefGoogle Scholar
  • Cook A, Glass C (2014) Above the glass ceiling: When are women and racial/ethnic minorities promoted to CEO? Strategic Management J. 35(7):1080–1089.CrossrefGoogle Scholar
  • Cooper RA, Day TE, Lewis CM (2001) Following the leader: A study of individual analysts’ earnings forecasts. J. Financial Econom. 61(3):383–416.CrossrefGoogle Scholar
  • Crisp RJ, Hewstone M (2001) Multiple categorization and implicit intergroup bias: Differential category dominance and the positive-negative asymmetry effect. Eur. J. Soc. Psych. 31(1):45–62.CrossrefGoogle Scholar
  • D’Acunto F, Ghosh P, Jain R, Rossi AG (2021) How costly are cultural biases? Evidence from fintech. Preprint, submitted January 8, https://dx.doi.org/10.2139/ssrn.3736117.Google Scholar
  • Demerjian P, Lev B, McVay S (2012) Quantifying managerial ability: A new measure and validity tests. Management Sci. 58(7):1229–1248.LinkGoogle Scholar
  • Doan T, Iskandar-Datta M (2021) Does gender in the c-suite really matter? J. Accounting Auditing Finance 36(1):81–107.CrossrefGoogle Scholar
  • Dwivedi P, Joshi A, Misangyi VF (2018) Gender-inclusive gatekeeping: How (mostly male) predecessors influence the success of female CEOs. Acad. Management J. 61(2):379–404.CrossrefGoogle Scholar
  • Fama EF, French KR, Fama EF (1992) The cross-section of expected stock returns. J. Finance 47(2):427–465.CrossrefGoogle Scholar
  • Fanelli A, Misangyi VF, Tosi HL (2009) In charisma we trust: The effects of CEO charismatic visions on securities analysts. Organ. Sci. 20(6):1011–1033.LinkGoogle Scholar
  • Fitza M (2014) The use of variance decomposition in the investigation of CEO effects: How large must the CEO effect be to rule out chance? Strategic Management J. 35(12):1839–1852.CrossrefGoogle Scholar
  • Francis J, Soffer L (1997) The relative informativeness of analysts’ stock recommendations and earnings forecast revisions. J. Accounting Res. 35(2):193–211.CrossrefGoogle Scholar
  • Francoeur C, Li Y, Singer Z, Zhang J (2022) Earnings forecasts of female CEOs: Quality and consequences. Rev. Accounting Stud. 28:1721–1764.Google Scholar
  • Gazal-Ayal O, Kenan RS (2010) Let my people go: Ethnic in-group bias in judicial decisions—Evidence from a randomized natural experiment. J. Empirical Legal Stud. 7(3):403–428.CrossrefGoogle Scholar
  • Grinblatt M, Keloharju M (2001) How distance, language, and culture influence stockholdings and trades. J. Finance 56(3):1053–1073.CrossrefGoogle Scholar
  • Hainmueller J (2012) Entropy balancing for causal effects: A multivariate reweighting method to produce balanced samples in observational studies. Political Anal. 20(1):25–46.CrossrefGoogle Scholar
  • Harrison J, Thurgood GR, Boivie S, Pfarrer M (2020) Perception is reality: How CEOs’ observed personality influences market perceptions of firm risk and shareholder returns. Acad. Management J. 63(4):1166–1195.CrossrefGoogle Scholar
  • Hewstone M, Rubin M, Willis H (2002) Intergroup bias. Annual Rev. Psych. 53:575–604.CrossrefGoogle Scholar
  • Hirshleifer D, Levi Y, Lourie B, Teoh SH (2019) Decision fatigue and heuristic analyst forecasts. J. Financial Econom. 133(1):83–98.CrossrefGoogle Scholar
  • Hong H, Kubik JD (2003) Analyzing the analysts: Career concerns and biased earnings forecasts. J. Finance 58(1):313–351.CrossrefGoogle Scholar
  • Huang AH, Zang A, Zheng R (2014) Evidence on the information content of text in analyst reports. Accounting Rev. 89(6):2151–2180.CrossrefGoogle Scholar
  • Irani AJ (2004) The effect of regulation fair disclosure on the relevance of conference calls to financial analysts. Rev. Quant. Finance Accounting 22(2002):15–28.CrossrefGoogle Scholar
  • Jiang D, Kumar A, Law KKF (2016) Political contributions and analyst behavior. Rev. Accounting Stud. 21:37–88.CrossrefGoogle Scholar
  • Jones JT, Pelham BW, Carvallo M, Mirenberg MC (2004) How do I love thee? Let me count the Js: Implicit egotism and interpersonal attraction. J. Personality Soc. Psych. 87(5):665–683.CrossrefGoogle Scholar
  • Jung JH, Kumar A, Lim SS, Yoo CY (2019) An analyst by any other surname: Surname favorability and market reaction to analyst forecasts. J. Accounting Econom. 67(2–3):306–335.CrossrefGoogle Scholar
  • Kanter RM (1977) Men and Women of the Corporation (Basic Books, New York).Google Scholar
  • Kross WJ, Suk I (2012) Does Regulation FD work? Evidence from analysts’ reliance on public disclosure. J. Accounting Econom. 53(1–2):225–248.CrossrefGoogle Scholar
  • Kumar A (2010) Self-selection and the forecasting abilities of female equity analysts. J. Accounting Res. 48(2):393–435.CrossrefGoogle Scholar
  • Kumar A, Niessen-Ruenzi A, Spalt OG (2015) What’s in a name? Mutual fund flows when managers have foreign-sounding names. Rev. Financial Stud. 28(8):2281–2321.CrossrefGoogle Scholar
  • Leonardelli G, Brewer M (2001) Minority and majority discrimination: When and why. J. Experiment. Soc. Psych. 37(6):468–485.CrossrefGoogle Scholar
  • Low A (2009) Managerial risk-taking behavior and equity-based compensation. J. Financial Econom. 92(3):470–490.CrossrefGoogle Scholar
  • Malmendier U, Shanthikumar D (2014) Do security analysts speak in two tongues? Rev. Financial Stud. 27(5):1287–1322.CrossrefGoogle Scholar
  • McCue K (1996) Promotions and wage growth. J. Labor Econom. 14(2):175–209.CrossrefGoogle Scholar
  • McGuire WJ, McGuire C (1981) The spontaneous self-concept as affected by personal distinctiveness. Lynch MD, Norem-Hebeisen A, Gergen KJ, eds. Self-Concept: Advances in Theory and Research, vol. 23 (Ballinger Publishing Company, Cambridge, MA), 147–171.Google Scholar
  • Mikhail MB, Walther BR, Willis RH (1999) Does forecast accuracy matter to security analysts? Accounting Rev. 74(2):185–200.CrossrefGoogle Scholar
  • Mokoaleli-Mokoteli T, Taffler RJ, Agarwal V (2009) Behavioural bias and conflicts of interest in analyst stock recommendations. J. Bus. Finance Accounting 36(3–4):384–418.CrossrefGoogle Scholar
  • Morse A, Shive S (2011) Patriotism in your portfolio. J. Financial Markets 14(2):411–440.CrossrefGoogle Scholar
  • Na K, Hong J (2017) CEO gender and earnings management. J. Appl. Bus. Res. 33(2):297–308.CrossrefGoogle Scholar
  • Niessen-Ruenzi A, Ruenzi S (2018) Sex matters: Gender bias in the mutual fund industry. Management Sci. 65(7):3001–3025.LinkGoogle Scholar
  • Palvia A, Vähämaa E, Vähämaa S (2015) Are female CEOs and chairwomen more conservative and risk averse? Evidence from the banking industry during the financial crisis. J. Bus. Ethics 131:577–594.CrossrefGoogle Scholar
  • Pelham BW, Carvallo M, Jones JT (2005) Implicit egotism. Current Directions Psych. Sci. 14(2):106–110.CrossrefGoogle Scholar
  • Pelham BW, Mirenberg MC, Jones JT (2002) Why Susie sells seashells by the seashore: Implicit egotism and major life decisions. J. Personality Soc Psych. 82(4):469–487.CrossrefGoogle Scholar
  • Peni E, Vähämaa S (2010) Female executives and earnings management. Managerial Finance 36(7):629–645.CrossrefGoogle Scholar
  • Petersen MA (2009) Estimating standard errors in finance panel data sets: Comparing approaches. Rev. Financial Stud. 22(1):435–480.CrossrefGoogle Scholar
  • Peterson SJ, Galvin BM, Lange D (2012) CEO servant leadership: Exploring executive characteristics and firm performance. Personnel Psych. 65(3):565–596.CrossrefGoogle Scholar
  • Price J, Wolfers JJ (2010) Racial discrimination among NBA referees. Quart. J. Econom. 125(4):1859–1887.CrossrefGoogle Scholar
  • Raden D (2003) Ingroup bias, classic ethnocentrism, and non-ethnocentrism among American whites. Political Psych. 24(4):803–828.CrossrefGoogle Scholar
  • Rudman LA, Goodwin SA (2004) Gender differences in automatic in-group bias: Why do women like women more than men like men? J. Personality Soc. Psych. 87(4):494–509.CrossrefGoogle Scholar
  • Ryan MK, Haslam SA (2005) The glass cliff: Evidence that women are over-represented in precarious leadership positions. British J. Management 16(2):81–90.CrossrefGoogle Scholar
  • Shayo M, Zussman A (2011) Judicial ingroup bias in the shadow of terrorism. Quart. J. Econom. 126(3):1447–1484.CrossrefGoogle Scholar
  • Shroff PK, Venkataraman R, Xin B (2014) Timeliness of analysts’ forecasts: The information content of delayed forecasts. Contemporary Accounting Res. 31(1):202–229.CrossrefGoogle Scholar
  • Simon B, Hamilton DL (1994) Self-stereotyping and social context: The effects of relative in-group size and in-group status. J. Personality Soc. Psych. 66(4):699–711.CrossrefGoogle Scholar
  • Soltes E (2014) Private interaction between firm management and sell-side analysts. J. Accounting Res. 52(1):245–272.CrossrefGoogle Scholar
  • Swan S, Wyer RS Jr (1997) Gender stereotypes and social identity: How being in the minority affects judgments of self and others. Personality Soc. Psych. Bull. 23(12):1265–1276.CrossrefGoogle Scholar
  • Tajfel H (1982) Social psychology of intergroup relations. Annual Rev. Psych. 33:1–39.CrossrefGoogle Scholar
  • Tajfel H, Turner JC (1979) An integrative theory of intergroup relations. Austin WG, Worchel S, eds. Psychology of Inter-Group Relations (Brooks-Cole, Monterey, CA), 33–48.Google Scholar
  • Turner JC, Hogg MA, Oakes PJ, Reicher SD, Wetherell MS (1987) Rediscovering the Social Group: A Self-Categorization Theory (Basil Blackwell, Oxford, UK).Google Scholar
  • Wagner DG, Berger J (1997) Gender and interpersonal task behaviors: Status expectation accounts. Sociol. Perspect. 40(1):1–32.CrossrefGoogle Scholar
  • Wang G, Holmes RM, Oh IS, Zhu W (2016) Do CEOs matter to firm strategic actions and firm performance? A meta-analytic investigation based on upper echelons theory. Personnel Psych. 69(4): 775–862.CrossrefGoogle Scholar
  • Withisuphakorn P, Jiraporn P (2017) CEO age and CEO gender: Are female CEOs older than their male counterparts? Finance Res. Lett. 22:129–135.CrossrefGoogle Scholar
  • Zitzewitz E (2002) Regulation fair disclosure and the private information of analysts. Preprint, submitted April 14, https://dx.doi.org/10.2139/ssrn.305219.Google Scholar
INFORMS site uses cookies to store information on your computer. Some are essential to make our site work; Others help us improve the user experience. By using this site, you consent to the placement of these cookies. Please read our Privacy Statement to learn more.