Rolls' hubris hypothesis argues that bank managers pay too much in acquisitions because they have excessive arrogance about their ability to produce profits from the merger organization.

Question

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The hubris hypothesis in the context of acquisitions, including those made by banks, suggests that managers often overpay due to overconfidence or arrogance about their ability to generate value or profits from the merger, believing they can manage the acquired assets more effectively than the current management.

Rolls' Hubris Hypothesis Argues That Bank Managers Pay Too Much