No reliance on guidance: counter-signaling in management forecasts
成果类型：
Article
署名作者：
Aghamolla, Cyrus; Corona, Carlos; Zheng, Ronghuo
署名单位：
University of Minnesota System; University of Minnesota Twin Cities; University System of Ohio; Ohio State University; University of Texas System; University of Texas Austin
刊物名称：
RAND JOURNAL OF ECONOMICS
ISSN/ISSBN：
0741-6261
DOI：
10.1111/1756-2171.12367
发表日期：
2021
页码：
207-245
关键词：
摘要：
This study presents and provides an explanation for a novel stylized fact: both high-performing and troubled companies withhold issuing earnings guidance. We assume that the manager's ability affects the level of earnings and the accuracy of guidance, but issuing a forecast is costless for all manager types. Managers are thus able to signal their ability through accuracy in their forecasts. While high ability managers would seem to benefit the most from issuing guidance, in equilibrium we find that both high and low ability managers withhold issuing guidance, while intermediate types forecast. Hence, high ability managers counter-signal in equilibrium, which does not result in a subsequent punishment by the market.
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