IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v56y2024i48p5727-5742.html
   My bibliography  Save this article

CEO overconfidence, asset specificity and firm outsourcing decisions

Author

Listed:
  • Wenbin Yang
  • Cheng Xue

Abstract

Outsourcing, which has become an important employment strategy, is of increasing interest in both management theory and practice. This paper investigates the determinants of outsourcing from the perspective of CEO overconfidence using manually collected outsourcing data from Chinese A-share listed companies for the period 2012–2020. The empirical results show that firms with overconfident CEOs are more likely to adopt outsourcing strategies, and the asset specificity mitigates the positive effect of CEO overconfidence on outsourcing decisions. Furthermore, we find the moderating effect of asset specificity occurs mainly in private firms rather than SOEs and in large firms rather than small firms. Our results indicate inefficiencies associated with overconfidence should be classified as honest mistakes rather than deliberate actions, and strong corporate governance mechanisms help overconfident CEOs avoid making honest mistakes.

Suggested Citation

  • Wenbin Yang & Cheng Xue, 2024. "CEO overconfidence, asset specificity and firm outsourcing decisions," Applied Economics, Taylor & Francis Journals, vol. 56(48), pages 5727-5742, October.
    • Handle: RePEc:taf:applec:v:56:y:2024:i:48:p:5727-5742
    DOI: 10.1080/00036846.2023.2257934
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/00036846.2023.2257934
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/00036846.2023.2257934?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:applec:v:56:y:2024:i:48:p:5727-5742. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.