CEO neuroticism and corporate cash holdings: Evidence from CEOs’ tweets

Dien Giau Bui, Robin K. Chou, Chih-Yung Lin and Chien-Lin Lu

Journal of Empirical Finance, 2025, vol. 80, issue C

Abstract: We examine the effects of CEO neuroticism on corporate policies for cash holdings. After hand collecting tweets by CEOs to measure their neuroticism, we find that firms with relatively neurotic CEOs hold more cash than other firms. This positive effect is more pronounced when the firm has a higher precautionary motive to hold cash. The cash held by firms with neurotic CEOs leads to higher firm values and lower credit risks. Overall, neurotic CEOs maintain more conservative corporate policies on holding cash, resulting in a lower cost of financial distress and an improvement in the value of firms.

Keywords: Cash holdings; CEO personality traits; CEO neuroticism; precautionary motives; value of cash (search for similar items in EconPapers)
JEL-codes: G30 G32 G40 G41 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:empfin:v:80:y:2025:i:c:s0927539824001002

DOI: 10.1016/j.jempfin.2024.101566

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