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The effect of CEO extraversion on private debt

Author

Listed:
  • Wang, Zongjun
  • Wang, Peng
  • Du, Yao
  • Lin, Chih-Yung

Abstract

We examine the effect of CEO extraversion on the cost of private debt. We hand-collect each daily tweet from S&P 1500 CEOs and utilize IBM Watson Personality to study their personalities. We find that extraversion in CEOs is related to risk-taking and leadership, which actuates firms to obtain benefits from their loan contracts. Particularly, these firms are more likely to encounter lower loan costs and longer loan maturities than other firms. Thus, firms managed by extraverts help to reduce the cost of bank loans.

Suggested Citation

  • Wang, Zongjun & Wang, Peng & Du, Yao & Lin, Chih-Yung, 2025. "The effect of CEO extraversion on private debt," Finance Research Letters, Elsevier, vol. 76(C).
    • Handle: RePEc:eee:finlet:v:76:y:2025:i:c:s1544612325002260
    DOI: 10.1016/j.frl.2025.106962
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    More about this item

    Keywords

    Private debt; CEO extraversion; IBM Watson Personality; loan cost;
    All these keywords.

    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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