Addressing managerial loss aversion for the corporate value creation process: a critical analysis of the literature and preliminary approaches
Author(s)
Date Issued
2023
Type
article
Volume
14
Issue
1
Start Page
1
End Page
16
Journal
Abstract
To date, the studies on managerial loss aversion have produced contradictory findings. With the aim of filling this gap, the authors of this paper first performed a Systematic Literature Review (SLR), resulting in 65 relevant papers. The 65 papers were then analysed through a thematic analysis (TA), which was aimed at
isolating and revising the single effects of managerial loss aversion on the corporate value creation
process. Once it became clear when and how managerial loss aversion leads to negative impacts
on corporate value creation, a novel theoretical framework was built. This framework proposes some preliminary approaches to mitigate these detrimental effects. In particular, future empirical research may operationalise potential debiasing strategies, derived from critical analysis of the literature, to reduce managerial loss aversion in different business settings, thereby improving corporate value creation.