Abstract
We examine the effects of both country and firm-level governance on cash holdings and the value of cash for a large international sample during the period 2002-2013. We find that both strong country and strong firm-level governance reduce the amount of cash holdings. We observe that a number of the components of both firm and country-level governance are significantly related to the decrease in cash holdings. We show that the value of cash increases as a result of good country-level governance and we provide mixed evidence that good firm-level governance also increases the value of cash. Our analysis also confirms that the payment of dividends adds to the value of cash. (C) 2017 Elsevier B.V. All rights reserved.
| Original language | English |
|---|---|
| Pages (from-to) | 1-16 |
| Number of pages | 16 |
| Journal | Journal of International Financial Markets, Institutions & Money |
| Volume | 52 |
| Early online date | 6-Dec-2017 |
| DOIs | |
| Publication status | Published - Jan-2018 |
Keywords
- Cash holdings
- Value of cash
- Corporate governance
- Country governance
- Dividend policy
- Firm value
- CORPORATE GOVERNANCE
- EQUITY PRICES
- HOLDINGS
- DETERMINANTS
- RESERVES
- US