ChatGPT and Corporate Policies

Manish Jha, Jialin Qian, Michael Weber and Baozhong Yang

No 32161, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We create a firm-level ChatGPT investment score, based on conference calls, that measures managers' anticipated changes in capital expenditures. We validate the score with interpretable textual content and its strong correlation with CFO survey responses. The investment score predicts future capital expenditure for up to nine quarters, controlling for Tobin's q and other determinants, implying the investment score provides incremental information about firms' future investment opportunities. The investment score also separately forecasts future total, intangible, and R&D investments. High-investment-score firms experience significant negative future abnormal returns. We demonstrate ChatGPT's applicability to measure other policies, such as dividends and employment.

JEL-codes: C81 E22 G14 G31 G32 O33 (search for similar items in EconPapers)
Date: 2024-02
New Economics Papers: this item is included in nep-acc, nep-ain, nep-cfn, nep-cmp, nep-fmk and nep-tid
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Working Paper: ChatGPT and Corporate Policies (2025)
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