CEO overconfidence and corporate financialization: the moderating role of internal and external governance

This paper investigates the effect of CEO overconfidence on corporate financialization and examines whether internal and external governance mechanisms moderate this relationship, using a sample of Chinese A-share listed firms from 2009 to 2019. The results show that firms led by overconfident CEOs exhibit significantly higher levels of financialization. Further analysis indicates that product market competition strengthens the positive influence of CEO overconfidence on financialization, whereas financing constraints weaken it. In contrast, corporate governance quality does not moderate this relationship. These findings deepen the understanding of managerial behavioral drivers of corporate financialization and offer implications for guiding firms toward real-sector investment and reducing financial risk.