Managerial attitudes and corporate actions

John R. Graham, Campbell Harvey () and Manju Puri

Journal of Financial Economics, 2013, vol. 109, issue 1, 103-121

Abstract: We administer psychometric tests to senior executives to obtain evidence on their underlying psychological traits and attitudes. We find US CEOs differ significantly from non-US CEOs in terms of their underlying attitudes. In addition, we find that CEOs are significantly more optimistic and risk-tolerant than the lay population. We provide evidence that CEOs' behavioral traits such as optimism and managerial risk-aversion are related to corporate financial policies. Further, we provide new empirical evidence that CEO traits such as risk-aversion and time preference are related to their compensation.

Keywords: Managers; Attitudes; Personality traits; Risk-aversion; Capital structure; Debt; Acquisitions; Corporate policies; Behavioral corporate finance (search for similar items in EconPapers)
JEL-codes: G30 G32 G34 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (380)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jfinec:v:109:y:2013:i:1:p:103-121

DOI: 10.1016/j.jfineco.2013.01.010

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