Women Executives and Corporate Investment: Evidence from the SP 1500

摘要

In this paper,we examine the gender effect of top executives on corporate investment decisions. Malmendier and Tate (2005) provide a theoretical argument and empirical evidence to show that the corporate investment of overconfident CEOs is significantly more sensitive to cash flow,particularly in equity-dependent firms. The social psychology and behavioral finance literatures suggest that men in general are more overconfident than are women. Using gender as a measure of relative overconfidence,we hypothesize that corporate investment of female executives should be less responsive to cash flow than should corporate investment of male executives,especially among equity-dependent firms. Using the executive gender data set from the S&P 1500,we find that the evidence is consistent with our hypotheses.