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Let me hear your voice: Emotional talkers in earnings conference calls

Elena Loutskina, Oleksandr Talavera, Shuxing Yin and Mao Zhang
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Elena Loutskina: University of Virginia
Shuxing Yin: University of Sheffield
Mao Zhang: University of St Andrews

Discussion Papers from Department of Economics, University of Birmingham

Abstract: This work examines the link between executives' vocal expressions and financial markets. We find that executives' emotional intensity, measured by changes in vocal pitch, contains incremental information beyond the verbal channel. A heightened vocal pitch displayed by executives during earnings conference calls is associated with positive abnormal stock returns, optimistic earnings forecasts, and high forecast quality. In addition to the informational role, we also find that a communication style with a higher-pitched voice dramatically improves the value of executives in the managerial labour market. This study provides new evidence that the way how executives communicate information matters to the market.

Keywords: conference calls; vocal pitch; emotional intensity; soft information; market reaction; managerial capabilities (search for similar items in EconPapers)
JEL-codes: G12 G14 G30 G34 G41 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2022-10
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