The Voice of Risk: Wall Street CEOs' Voice Pitch and the 2008 Financial Crisis*

Abstract

The pitch of a male voice is an honest signal of his threat potential coming from testosterone. Recognizing endogenous matches between firms and CEOs, we propose to use voice pitch of the CEO as a proxy for the unobservable risk-taking strategy of the firm. Using digitally analyzed male CEO voice pitch in 167 CNBC interviews during the 2008 global financial crisis, we find that deep-voiced Wall Street CEOs (i) managed riskier firms, (ii) received more equity-based compensation before the crisis and (iii) were more likely to be fired after the crisis, controlling for economic incentives, overconfidence, and narcissism.