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Chief Executive Officer's national culture and bank risk‐taking behavior: International evidence

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  • Quang Duy Luong
  • Duc Hong Vo
  • Chi Minh Ho

Abstract

This paper examines the effect of the national culture of the chief executive officers (CEOs) on their risk‐taking behavior in managing the banks, leading to banks' instability using a sample of 805 CEOs for 517 commercial banks in 33 countries from 2011 to 2017. Our empirical results confirm that bank risk‐taking behavior is negatively associated with the national culture of the CEOs who score high on the individualistic culture dimension. We also find that bank risk is likely to increase under the management of CEOs coming from high power distance countries. These results have largely remained unchanged across different settings.

Suggested Citation

  • Quang Duy Luong & Duc Hong Vo & Chi Minh Ho, 2024. "Chief Executive Officer's national culture and bank risk‐taking behavior: International evidence," Scottish Journal of Political Economy, Scottish Economic Society, vol. 71(3), pages 492-513, July.
    • Handle: RePEc:bla:scotjp:v:71:y:2024:i:3:p:492-513
    DOI: 10.1111/sjpe.12378
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