Working Paper: NBER ID: w22435
Authors: Ian D. Gow; Steven N. Kaplan; David F. Larcker; Anastasia A. Zakolyukina
Abstract: Based on two samples of high quality personality data for chief executive officers (CEOs), we use linguistic features extracted from conferences calls and statistical learning techniques to develop a measure of CEO personality in terms of the Big Five traits: agreeableness, conscientiousness, extraversion, neuroticism, and openness to experience. These personality measures have strong out-of-sample predictive performance and are stable over time. Our measures of the Big Five personality traits are associated with financing choices, investment choices and firm operating performance.
Keywords: CEO personality; firm policies; big five traits; investment choices; financing choices
JEL Codes: D22; D23; G3; G34
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| openness (O36) | R&D intensity (O32) |
| openness (O36) | net leverage (G32) |
| conscientiousness (D91) | growth (O40) |
| extraversion (Z13) | return on assets (G32) |
| extraversion (Z13) | cash flows (G19) |