1. Does the CEO elite education affect firm hedging policies?
- Author
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Sabri Boubaker, Salma Mefteh-Wali, Ephraim Clark, Institut de Recherche en Gestion (IRG), Université Paris-Est Marne-la-Vallée (UPEM)-Université Paris-Est Créteil Val-de-Marne - Paris 12 (UPEC UP12), Ecole Supérieure des Sciences Commerciales d'Angers (ESSCA), Groupe ESSCA (ESSCA), and Université Paris-Est Créteil Val-de-Marne - Paris 12 (UPEC UP12)-Université Paris-Est Marne-la-Vallée (UPEM)
- Subjects
Selection bias ,Economics and Econometrics ,050208 finance ,media_common.quotation_subject ,05 social sciences ,Enterprise value ,Control (management) ,Control variable ,Affect (psychology) ,[SHS]Humanities and Social Sciences ,Microeconomics ,Currency ,0502 economics and business ,Elite ,Economics ,Endogeneity ,050207 economics ,Finance ,media_common - Abstract
This paper studies the relationship between CEO elite education and firm hedging decisions. It uses the particular specificities of the French post-secondary educational institutions to examine the effect of CEO educational background on the use of foreign currency derivatives. The results show a positive and significant relationship between education quality and derivatives use. Neither the level nor the type of education has any significant effect. The results also show that the use of derivatives enhances firm performance only when CEOs are from elite institutions. These results are robust to a battery of tests that involve alternative estimation techniques, the use of different subsamples, additional control variables, and control for endogeneity and selection bias.
- Published
- 2020
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