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The typical financial analyst in the U.S. earns less than $100,000 a year, but top names in the field take home far more princely sums. It’s no surprise these big-name moneymakers are well compensated – after all, their job is to turn their employers’ small fortunes into, well, much larger ones.

But do big-league analysts really deserve those big paydays? New research from Boise State University management professor Steven Hyde and his team suggests otherwise: Financial analysts are often duped by lying CEOs − in fact, the best-respected analysts may be the most gullible.

Hyde’s research suggests firms are wasting money on bad advice − but its implications go beyond the world of finance. In fact, to reach Hyde’s conclusions, his team built what amounts to an artificial intelligence lie detector. And, as he argues, this sort of cutting-edge work in psychometrics could reshape society as a whole.

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Tracy Walsh

Economy + Business Editor

Everyone is vulnerable to the ‘truth bias’ − even people paid to know better. Stephanie Phillips/E+ via Getty Images

Deceit pays dividends: How CEO lies can boost stock ratings and fool even respected financial analysts

Steven J. Hyde, Boise State University

Financial analysts have a gullibility problem − and the better their reputation, the worse it is.

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