Perception Is Reality: How CEOs’ Observed Personality Influences Market Perceptions of Firm Risk and Shareholder Returns

Volume: 63, Issue: 4, Pages: 1166 - 1195
Published: Aug 1, 2020
Abstract
We develop theory to explain how CEOs’ observable personality traits influence market perceptions of firm risk and shareholder returns. Using a linguistic tool to measure nearly 3,000 CEOs’ personality traits, we find that CEOs’ observed levels of conscientiousness, neuroticism, and extraversion have important consequences for the perceived riskiness of the firm, as reflected in stock volatility. We also find that these traits alter the...
Paper Details
Title
Perception Is Reality: How CEOs’ Observed Personality Influences Market Perceptions of Firm Risk and Shareholder Returns
Published Date
Aug 1, 2020
Volume
63
Issue
4
Pages
1166 - 1195
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