Managers’ overconfidence leads to overestimating their ability to manage cash sources. Holding more cash may result in overinvestment in projects and investment inefficiency consequently. The present study aims to investigate the effect of cash holding on investment efficiency with the moderating role of managerial overconfidence in Iranian companies. All listed firms in Tehran Stock Exchange, excluding banks, insurance, pension funds, and financial intermediaries, are included in the research. We have used data from financial statements of 91 companies over the period from 2010 to 2018 and conducted multiple regression models to test the hypotheses based on pooled and panel data set with fixed effects. The results indicate a positive relationship between managerial overconfidence and cash holding. The effect of cash holding on investment efficiency turns out to be significantly negative. Furthermore, managerial overconfidence has a significant moderating effect on the relation of the variables. This study is almost the first one, which has been done in emerging markets, so the study’s findings not only contribute to the existing literature on managerial overconfidence and investment efficiency but also assist policymakers, managers, and investors in making effective decisions.
The conflicts of interest between managers and shareholders force managers to make decisions that do not meet the interests of shareholders. One of these decisions is to invest less in the company’s operational activities. Increasing the information quality is one way to prevent that issue, allowing stakeholders to monitor investment decisions. The present study investigates the relation of accounting information quality, corporate investment, and ownership structure for Iranian firms, using panel data analysis from 2009 to 2018. We applied a multiple regression model to test the hypotheses. The results show that the quality of accounting information significantly affects the investment decision for the company’s main operations, so the first hypothesis of the research is confirmed. At the same time, there is no effect of capital structure on accounting information quality and firms’ investment decisions. Thus, the second hypothesis of the research failed to be confirmed.
An efficient banking system with the right monetary policy by controlling liquidity and inflation and directing resources to productive economic activities plays an essential role in economic development. However, banks’ performance is influenced by various political, economic, managerial, and social factors, and the study of these factors has been considered the topic of interest to researchers. This paper uses the structural equation modeling method to investigate the effect of ownership structure and corporate governance on listed banks’ performance in the Tehran Stock Exchange from 2011 to 2017. Based on the results, ownership structure dimensions have a relatively insignificant impact on corporate governance. However, the financial performance dimension has a statistically significant negative effect. The results also indicate that corporate governance is significantly associated with a positive effect on financial performance. Consequently, the results indicate that corporate governance may mitigate the negative impact that ownership structure dimensions may have on bank financial performance.
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