The Effect of Management Myopia on the Crash Risk of Stock Prices of Companies Listed in Tehran Stock Exchange
This study investigates the effect of management myopia on the crash risk of stock prices of companies in listed Tehran Stock Exchange. To achieve the objectives of this study, 105 companies were selected from among the listed companies in Tehran Stock Exchange during years 2011-2017. In this study, companies have been considered to suffer from management myopia that despite having positive financial performance and increased return on assets, their marketing and R&D costs have been reduced. The crash risk of stock prices has also been measured using the negative skewness of stock returns. Sampling method in this study is systematic and multivariate regression technique and panel data method was used to test the hypothesis. After confirming the acceptable fit of the measurement and structural models for the research, the results indicated that management myopia has a positive and significant effect on the crash risk stock prices of companies; meaning that the crash risk of stock prices is more likely in companies with management myopia.