Girls Will Be Girls? The Gendered Effect of Economic Policy Uncertainty on Corporate Investment
Caroline Perrin and
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Caroline Perrin: LaRGE Research Center, Université de Strasbourg
Working Papers of LaRGE Research Center from Laboratoire de Recherche en Gestion et Economie (LaRGE), Université de Strasbourg
We examine the effect of CEO gender on the relation between economic policy uncertainty (EPU) and corporate investment. Using the newspaper-based EPU index developed by Baker, Bloom, and Davis (2016), we perform an empirical investigation on firm-level data of more than 38,000 firms from eight European countries for 2010-2019. We find evidence that higher EPU is associated with higher corporate investment. However, we show that this beneficial effect of economic policy uncertainty is lower when the firm CEO is a woman. We explain this finding by the higher risk aversion of women relative to men. Our main results are robust to a battery of sensitivity tests. Our work contributes to the debate on the impact of EPU on firm corporate decisions by bringing upfront the influence of CEO gender.
Keywords: Economic policy uncertainty; firm investment; CEO gender. (search for similar items in EconPapers)
JEL-codes: G30 G32 J16 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cfn, nep-cwa, nep-eur, nep-gen and nep-sbm
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Persistent link: https://EconPapers.repec.org/RePEc:lar:wpaper:2021-04
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