Time Variation in the Marginal Value of Firms' Cash Holdings

2012 ◽  
Author(s):  
Michael O'Connor Keefe ◽  
Robert L. Kieschnick
Keyword(s):  
Time Variation ◽  
Cash Holdings ◽  
Marginal Value

Time Variation in the Marginal Value of Firms’ Cash Holdings

2012 ◽  
Author(s):  
Michael O'Connor Keefe ◽  
Robert L. Kieschnick
Keyword(s):  
Time Variation ◽  
Cash Holdings ◽  
Marginal Value

Cash Is Not Always King: Economic Policy Uncertainty and the Marginal Value of Corporate Cash Holdings

2021 ◽  
Author(s):  
Ziwen Bu ◽  
Ahmet Karpuz ◽  
Rongbing Xiao ◽  
Huainan Zhao
Keyword(s):  
Economic Policy ◽  
Cash Holdings ◽  
Policy Uncertainty ◽  
Economic Policy Uncertainty ◽  
Marginal Value ◽  
Corporate Cash Holdings

Audit committee members with CEO experience and the value of cash holdings

2020 ◽  
Vol 35 (7) ◽  
pp. 897-926
Author(s):  
Sunhwa Choi ◽  
Jinwoong Han ◽  
Taejin Jung ◽  
Bomi Song
Keyword(s):  
Audit Committee ◽  
Negative Impact ◽  
Cash Holdings ◽  
Chief Executive ◽  
Policy Implications ◽  
Content Type ◽  
Marginal Value ◽  
Value Of Cash ◽  
Negative Effect ◽  
Accounting Expertise

Purpose The purpose of this study is to examine whether the presence of an audit committee (AC) members with Chief Executive Officer (CEO) experience (supervisory experts) affects the market value of cash holdings. Design/methodology/approach To estimate the marginal value of cash holdings, this study uses the model proposed by Faulkender and Wang (2006). The sample is 2,031 firm-year observations in Korea from 2000 through 2015. Findings The authors find that the presence of supervisory experts on ACs has a negative impact on the value of cash holdings. This result suggests that supervisory experts on ACs weaken monitoring of managerial actions. The authors also find that the negative effect of supervisory experts on the value of cash holdings is mitigated when there are other AC members with accounting expertise. Practical implications The findings that AC supervisory expertise impairs the effectiveness of ACs, and thus destroys shareholder value have policy implications because the current regulations in many countries use a broad definition of financial expertise that includes supervisory expertise. Originality/value This is the first study that directly examines the effect of AC supervisory expertise on the value of cash holdings. The study also contributes to the literature on the role of ACs in emerging markets by documenting the limitations of corporate governance systems adopted from the Anglo–Saxon model.

Labor Union Effect on Corporate Cash Holdings and Their Marginal Value

2018 ◽  
Vol 54 (6) ◽  
pp. 1391-1413 ◽  
Author(s):  
Minshik Shin ◽  
Sooeun Kim ◽  
Jongho Shin ◽  
Jaeik Lee
Keyword(s):  
Labor Union ◽  
Cash Holdings ◽  
Marginal Value ◽  
Corporate Cash Holdings

Earnings Quality Effect on Corporate Excess Cash Holdings and Their Marginal Value

2018 ◽  
Vol 54 (4) ◽  
pp. 901-920 ◽  
Author(s):  
Minshik Shin ◽  
Sooeun Kim ◽  
Jongho Shin ◽  
Jaeik Lee
Keyword(s):  
Earnings Quality ◽  
Cash Holdings ◽  
Marginal Value ◽  
Excess Cash

scholarly journals The Impact of Predation Risk on the Marginal Value of Cash Holdings: An Empirical Perspective

2017 ◽  
Vol 06 (02) ◽  
pp. 150-162
Author(s):  
Xinbao Yang ◽  
Jiguang Zheng
Keyword(s):  
Predation Risk ◽  
Cash Holdings ◽  
Marginal Value ◽  
Value Of Cash ◽  
Empirical Perspective ◽  
The Impact

Do Investors Holding Debt and Equity Decrease the Marginal Value of Firms' Cash Holdings?

2021 ◽  
Vol 28 (1) ◽  
pp. 51-78
Author(s):  
Joonil Lee ◽  
Wonsuk Ha
Keyword(s):  
Cash Holdings ◽  
Marginal Value

Impact of Free Cash Flow and the Marginal Value of Cash Holdings on Firms Overinvestment with Respect to Pakistan.

2021 ◽  
Author(s):  
Syed Abu Naveed Kashan ◽  
Danish Ahmed Siddiqui
Keyword(s):  
Cash Flow ◽  
Cash Holdings ◽  
Free Cash Flow ◽  
Marginal Value ◽  
Value Of Cash

scholarly journals Excess cash holdings, investment opportunity and shareholder value: European evidences

2016 ◽  
Vol 14 (1) ◽  
pp. 630-639 ◽  
Author(s):  
Simone Terzani ◽  
Giovanni Liberatore
Keyword(s):  
Financial Constraints ◽  
Shareholder Value ◽  
Cash Holdings ◽  
Investment Opportunity ◽  
Ceteris Paribus ◽  
Marginal Value ◽  
Investment Opportunities ◽  
High Investment ◽  
Precautionary Motive ◽  
Excess Cash

In this paper, we examine the marginal value of extra liquidity for a sample of excess cash listed companies (i.e. ECs) operating in the five largest E.U. economies (France, Italy, Germany, Spain and UK). After had shown that these companies are generally penalised by the market, in line with previous literature, we show that extra cash held is not detrimental to shareholder value when it is combined with high investment opportunities leading, hence, in a premium of 1€ extra held. This relation is even stronger during the financial crisis of 2008. These results confirm that the main reason why ECs are generally valued less by the market is the concern that their managers may deploy excess cash in value-destroying activities. However, EC firms are not penalized ceteris paribus when there are investment opportunities. In addition, such relation is stronger with the presence of financial constraints and lack of liquidity, as explained by the transaction and precautionary motive for holding cash.

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