Does CEO's disaster experience affect corporate maturity mismatch?—Evidence from the Great Famine in China

Chun Tang, Xiaobing Lai and Xiaoxing Liu

Finance Research Letters, 2024, vol. 64, issue C

Abstract: This paper studies the impact of CEO's childhood famine experience on corporate maturity mismatch. We find that such experience significantly exacerbates maturity mismatch, which is attributed to CEO's overconfidence and rising risk appetite caused by the Great Famine. Subsequent analysis provides the evidence of active mismatches by famine CEOs, and reveals that this proactive behavior results in a reduction in investment efficiency. Furthermore, we reveal that both internal control and institutional shareholding significantly restrain maturity mismatch caused by the famine experience, while oversight from insurance institutions instead amplifies the maturity mismatch issue.

Keywords: Corporate maturity mismatch; CEO famine experience; Imprinting theory (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:64:y:2024:i:c:s1544612324005178

DOI: 10.1016/j.frl.2024.105487

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