Do CEOs with academic experience add value to firms? Evidence on bank loans from Chinese firms

摘要

This study uses Chinese firms to show that CEOs with academic experience obtain bank loans with lower loan spreads, longer maturity, and fewer collateral requirements. They enhance goodwill of the firms (social capital and better-quality earnings reporting) and lower agency costs to reduce loan spread. Academic CEOs engage in a series of stewardship behaviors to improve financial performance. They play a critical role in determining the private debt contracts.