First, this paper aims to examine the presence of over-confidence bias in developed, emerging and frontier markets, for the period January 2006 to June 2020. For this the authors used the toda test Yamamoto. Indeed, the authors found that the over-confidence bias is more noticeable in developed markets than in emerging markets. Furthermore, this bias is almost nonexistent in frontier markets. Second, this study analyzes the impact of investor overconfidence on stock market volatility developed and emerging during several crises. This article examines this impact, using GARCH model and OLS-panel model. The authors have noticed that in times of crisis, the bias of overconfidence does not explain the volatility because of the loss of confidence of investors blamed on their fear and their lack of confidence the authors have found that this result is more noticeable on developed markets than in emerging markets.
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Research Article|
June 29 2026
Overconfidence bias and stock market volatility during crises: developed, emerging and frontier markets
Manel Mahjoubi;
Finance Department
, Higher Institute of Management of Gabès
, Gabes, Tunisia
Corresponding author Manel Mahjoubi mnlmahjoubi@yahoo.com
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Jamel Eddine Henchiri
Jamel Eddine Henchiri
Finance Department
, Higher Institute of Management of Gabès
, Gabes, Tunisia
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Corresponding author Manel Mahjoubi mnlmahjoubi@yahoo.com
Conflict of interest: The authors declare that they have no conflict of interest.
Received:
August 25 2025
Revision Received:
December 07 2025
Revision Received:
February 08 2026
Accepted:
February 23 2026
Online ISSN: 2326-6201
Print ISSN: 2326-6198
© 2026 Emerald Publishing Limited
2026
Emerald Publishing Limited
Licensed re-use rights only
Review of Behavioral Economics 1–23.
Article history
Received:
August 25 2025
Revision Received:
December 07 2025
Revision Received:
February 08 2026
Accepted:
February 23 2026
Citation
Mahjoubi M, Henchiri JE (2026;), "Overconfidence bias and stock market volatility during crises: developed, emerging and frontier markets". Review of Behavioral Economics, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/RBE-08-2025-0068
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