Early Life Experience and CEOs’ Reactions to COVID-19

This study investigates how CEOs’ experience of natural disasters and severe disease outbreaks in their formative years during childhood influences their firms’ responses to the coronavirus disease (COVID-19) pandemic in the United States. We observe that CEOs who faced disease outbreaks akin to COVID-19 early in their lives demonstrate more pronounced responses to its emergence in late February 2020, notably through a substantial slowdown in capital expenditure growth. Moreover, these imprinted CEOs exhibit heightened pessimism in their earnings forecasts and a more negative tone in their corporate disclosure following the COVID-19 outbreak. These findings suggest that severe events early in life leave indelible imprints on memory, thereby impacting CEOs’ behavior when managing similar crises in their professional careers.