Economic Policy Uncertainty, Institutional Environments, and Corporate Cash Holdings

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dc.contributor.authorEl Ghoul, Sadoken
dc.contributor.authorGuedhami, Omraneen
dc.contributor.authorMansi, Sattar A.en
dc.contributor.authorWang, He Helenen
dc.date.accessioned2023-01-03T15:54:11Zen
dc.date.available2023-01-03T15:54:11Zen
dc.date.issued2022-10-11en
dc.date.updated2022-12-23T14:23:55Zen
dc.description.abstractWe investigate the effect of economic policy uncertainty (EPU) on corporate cash holdings using a large sample of international firms. EPU intensifies concerns of investors on managerial self-dealing and political extraction. Consequently, the potential cost of cash holdings (i.e., expropriation) outweighs its benefit (i.e., precautionary motives), and the optimal amount of cash holdings decreases. We find supportive evidence that firms hold less cash when EPU is high. We further show that the market discounts excess cash holdings under high policy uncertainty, but this negative effect is mitigated by stronger investor protection, better freedom of press, and better government quality.en
dc.format.mimetypeapplication/pdfen
dc.identifier.orcidMansi, Sattar [0000-0001-7098-7996]en
dc.identifier.urihttp://hdl.handle.net/10919/113007en
dc.language.isoenen
dc.rightsIn Copyrighten
dc.rights.urihttp://rightsstatements.org/vocab/InC/1.0/en
dc.subjectPolicy uncertaintyen
dc.subjectCash holdingsen
dc.subjectInvestor protectionen
dc.subjectPress freedomen
dc.subjectGovernment qualityen
dc.titleEconomic Policy Uncertainty, Institutional Environments, and Corporate Cash Holdingsen
dc.typeArticle - Refereeden
dc.type.dcmitypeTexten
pubs.organisational-group/Virginia Techen
pubs.organisational-group/Virginia Tech/Pamplin College of Businessen
pubs.organisational-group/Virginia Tech/Pamplin College of Business/Finance, Insurance, and Business Lawen
pubs.organisational-group/Virginia Tech/All T&R Facultyen
pubs.organisational-group/Virginia Tech/Pamplin College of Business/PCOB T&R Facultyen

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