Discussion of “Making sense of soft information: Interpretation bias and loan quality”

Journal Article (Journal Article)

Campbell, Loumioti, and Wittenberg-Moerman (2018), henceforth CLW, provide evidence on the effect of human cognitive limitations on the processing of soft information in a Credit Union. Their results suggest that cognitive limitations constitute an important barrier to financial markets' ability to extract soft information. In this discussion, I delineate CLW's contribution and implications of their results, highlight key features of the empirical analyses that address interpretational difficulties that might confront some readers, and point out some limitations and unanswered questions that appear important to address in future research to obtain a more complete understanding of soft information production in financial markets.

Full Text

Duke Authors

Cited Authors

  • Vashishtha, R

Published Date

  • November 1, 2019

Published In

Volume / Issue

  • 68 / 2-3

International Standard Serial Number (ISSN)

  • 0165-4101

Digital Object Identifier (DOI)

  • 10.1016/j.jacceco.2019.101239

Citation Source

  • Scopus