Media uncertainty and risk-taking

This study investigates the association between uncertain media tone and risk-taking measures that capture CEO risk-taking incentives, corporate investment, and financial policies. The study predicts that CEOs who attract greater uncertain media tone have more risk-taking incentives. We find a positive association between uncertain media tone and R&D expenditures and financial leverage, and a negative association between uncertain media tone and capital expenditure. Our results are robust to endogeneity concerns and further tests, and demonstrate the importance of uncertainty to executive decision-making. The study documents a potential missing link between uncertain media tone, CEO discretion, and firm risk-taking activities.

Automated summary

This study examines the relationship between uncertain media tone and CEO risk-taking incentives, corporate investment, and financial policies. The findings suggest that CEOs who attract greater uncertain media tone are more inclined to take risks. The study also highlights the significance of uncertainty in executive decision-making.