The DOI matches its Crossref record; 7 of the 7 references it cites were found in a registry or an index.
Fool's Gold: Social Proof in the Initiation and Abandonment of Coverage by Wall Street Analysts
Abstract
This paper examines the dynamics of social influence in the choices of securities analysts to initiate and abandon coverage of firms listed on the NASDAQ national market. We show that social proof—using the actions of others to infer the value of a course of action—creates information cascades in which decision makers initiate coverage of a firm when peers have recently begun coverage. Analysts that initiate coverage of a firm in the wake of a cascade are particularly prone to overestimating the firm's future profitability, however, and they are subsequently more likely than other analysts to abandon coverage of the firm. We thus find evidence for a cycle of imitation-driven choice followed by disappointment and abandonment. Our account suggests that institutionalization rooted in imitation is likely to be fragile.
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Cites
Tversky, A., & Kahneman, D. (1974) · Science · doi:10.1126/science.185.4157.1124 · Cited by 28,810
Sample Selection Bias as a Specification Error
Heckman, J. J. (1979) · Econometrica · doi:10.2307/1912352 · Cited by 28,779
Judgment under Uncertainty: Heuristics and Biases
Tversky, A., & Kahneman, D. (1975) · Utility, Probability, and Human Decision Making · doi:10.1007/978-94-010-1834-0_8 · Cited by 22,650
A Cognitive Model of the Antecedents and Consequences of Satisfaction Decisions
Oliver, R. L. (1980) · Journal of Marketing Research · doi:10.1177/002224378001700405 · Cited by 14,494
Strategic Responses to Institutional Processes
Oliver, C. (1991) · The Academy of Management Review · doi:10.5465/amr.1991.4279002 · Cited by 8,950
Regret Theory: An Alternative Theory of Rational Choice Under Uncertainty
Loomes, G., & Sugden, R. (1982) · The Economic Journal · doi:10.2307/2232669 · Cited by 4,042
Group inhibition of bystander intervention in emergencies.
Latane, B., & Darley, J. M. (1968) · Journal of Personality and Social Psychology · doi:10.1037/h0026570 · Cited by 1,252
Cited by
Collaboration and Creativity: The Small World Problem
Uzzi, B., & Spiro, J. (2005) · American Journal of Sociology · doi:10.1086/432782 · Cited by 1,885
MEDIA LEGITIMATION EFFECTS IN THE MARKET FOR INITIAL PUBLIC OFFERINGS.
Pollock, T. G., & Rindova, V. P. (2003) · Academy of Management Journal · doi:10.2307/30040654 · Cited by 1,122
A Behavioral Theory of the Firm—40 Years and Counting: Introduction and Impact
Argote, L., & Greve, H. R. (2007) · Organization Science · doi:10.1287/orsc.1070.0280 · Cited by 606
Self-citationAmblee, N., & Bui, T. (2011) · International Journal of Electronic Commerce · doi:10.2753/jec1086-4415160205 · Cited by 490
A Longitudinal Study of Herd Behavior in the Adoption and Continued Use of Technology1
Sun, H. (2013) · MIS Quarterly · doi:10.25300/misq/2013/37.4.02 · Cited by 375
Metadata
- Authors
- Rao, H., Greve, H. R., & Davis, G. F.
- Venue
- Administrative Science Quarterly
- Publisher
- JSTOR
- Published
- 2001-09
- Volume
- 46
- Issue
- 3
- Pages
- 502-526
- ISSN
- 0001-8392 (ISSN-L)
- 1930-3815
- OpenAlex
- W2143625851
- Cited by
- 598
- References
- 7
- FWCI
- 12.46
- Type
- journal article
- Language
- en
- Open access
- closed
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Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
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