Year: 2023
Type: article
Abstract: ABSTRACT Literature on equity analysts presents a conundrum: analysts are seen as influential market participants, yet researchers widely criticize them for their bias and inaccuracy. Studies drawing from economic frames struggle to explain this. Therefore, we develop a new conceptualization that positions analysts as actors operating in a social field. Drawing on a qualitative study involving 70 interviews with analysts and portfolio managers, we offer two broad insights. First, we identify long-term interpersonal and interinstitutional ties between buy-side and sell-side actors which contribute to social inertia in the field. Second, we illustrate how sell-side analysts’ social environment is dichotomous, pushing some to converge with consensus estimates, while encouraging others to diverge. Taken as a whole, our findings contribute to the accounting literature by enriching our understanding of the social and institutional forces that govern analyst behavior.
Source: The Accounting Review
Authors: Yuval Millo, Crawford Spence, James Valentine
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: bronze
Funder: Leverhulme Trust
Award: G7190199248
OpenAlex ID: W4385069611