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Social Executives’ emotions and firm value: An empirical study enhanced by cognitive analytics

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  • Wang, Qiping
  • Yiu Keung Lau, Raymond
  • Xie, Haoran
  • Liu, Hongyan
  • Guo, Xunhua

Abstract

Investors are increasingly relying on social media to seek insights into corporate prospects. However, it remains unclear whether social executives—those engaging with stakeholders through social media—provide valuable information that shapes investors’ investment decisions, thereby influencing firm value. Drawing on emotions as social information theory, this study explores the impact of social executives’ emotions, derived from social media posts, on firm value. Moreover, we consider variances in effects across different post types and firm sizes. Applying advanced cognitive analytics and deep learning techniques, our analysis reveals a significant association between the emotions of fear and anger expressed in posts related to firm events or routine work and firm value, with more pronounced effects observed in small firms. Additionally, our machine learning experiments demonstrate that social executives’ emotions contribute to more accurate predictions of firm value than sentiments alone. These findings have important implications for both theory and practice.

Suggested Citation

  • Wang, Qiping & Yiu Keung Lau, Raymond & Xie, Haoran & Liu, Hongyan & Guo, Xunhua, 2024. "Social Executives’ emotions and firm value: An empirical study enhanced by cognitive analytics," Journal of Business Research, Elsevier, vol. 175(C).
    • Handle: RePEc:eee:jbrese:v:175:y:2024:i:c:s0148296324000791
    DOI: 10.1016/j.jbusres.2024.114575
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