Managerial Overoptimism and Discretionary Disclosure

Nikolaj Niebuhr Lambertsen & Matthias Lassak

Journal of Business Finance & Accounting2026https://doi.org/10.1111/jbfa.70059article
AJG 3ABDC A*
Weight
0.50

Abstract

We examine the effect of managerial overoptimism on discretionary disclosure of subjective information, such as earnings forecasts. The market applies a discount upon disclosure to capture the possibility that the revealed subjective expectation is too optimistic. While this discount is correct on average, it is too high (low) for a truly objective (overoptimistic) manager. Consequently, overoptimistic managers disclose more frequently, and their firms are overvalued. We show that higher levels of overoptimism or a greater fraction of overoptimistic managers amplify the market discount, which ultimately reduces overall disclosure in equilibrium.

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https://doi.org/https://doi.org/10.1111/jbfa.70059

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@article{nikolaj2026,
  title        = {{Managerial Overoptimism and Discretionary Disclosure}},
  author       = {Nikolaj Niebuhr Lambertsen & Matthias Lassak},
  journal      = {Journal of Business Finance & Accounting},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1111/jbfa.70059},
}

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

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