We examine the role and economic consequences of emotions in influencing the judgment of corporate executives. Analyzing a large sample of U.S. public firms, we find that sunshine-induced good mood leads managers to make upwardly biased earnings forecasts. Importantly, our evidence implies that...

In this study, we show that managerial heterogeneity plays an important role in firm decisions. Our view is that in addition to the effects of previously examined determinants, firm decisions are affected not just by the managers’ explicit mandate to maximize firm value, but also by the...