Clouded judgment: The role of sentiment in credit origination

• 成果类型: Article
• 署名作者: Cortes, Kristle; Duchin, Ran; Sosyura, Denis
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Cleveland; University of Washington; University of Washington Seattle; University of Michigan System; University of Michigan
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2016.05.001
• 发表日期: 2016
• 页码: 392-413
• 关键词: Behavioral finance; Managerial biases; mood; Sentiment; weather

摘要

Using daily fluctuations in local sunshine as an instrument for sentiment, we study its effect on day-to-day decisions of lower-level financial officers. Positive sentiment is associated with higher credit approvals, and negative sentiment has the opposite effect of a larger magnitude. These effects are stronger when financial decisions require more discretion, when reviews are less automated, and when capital constraints are less binding. The variation in approval rates affects ex post financial performance and produces significant real effects. Our analysis of the economic channels suggests that sentiment influences managers' risk tolerance and subjective judgment. (C) 2016 Elsevier B.V. All rights reserved.