Judgment effects of familiarity with an analyst�s name

• Autores: Wei Chen, Hun-Tong Tan
• Localización: Accounting, organizations and society: an international journal devoted to the behavioural, organizational and social aspects of accounting, ISSN 0361-3682, Vol. 38, Nº. 3, 2013, págs. 214-227
• Idioma: inglés
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• Resumen

  • We conduct an experiment with MBA students where we manipulate whether participants are exposed to an analyst�s name in Stage 1, and whether they are given a cue in Stage 2 about the particular analyst�s prior performance as an All-star analyst. We find that in the absence of a favorable performance cue about the analyst, mere exposure to the analyst�s name enhances perceived analyst credibility, which in turn influences the investors� earnings estimates. This suggests a benefit to analysts in terms of building credibility merely through media exposure that cannot be explained by performance. In fact, a diagnostic cue such as the analyst�s high prior performance no longer matters to investors once they have prior exposure to the analyst�s name. However, this enhancement of an analyst�s credibility through investors� prior exposure to his/her name is reversed when the analyst�s forecast turns out to be inaccurate.