Does foreign culture affect corporate cash holdings?

Guoxing Li, Chengming Luo, Sitong Chen and Ni Zhong

International Review of Financial Analysis, 2025, vol. 104, issue PA

Abstract: This study analyzes the impact of foreign culture on corporate cash holdings using a sample of Chinese listed companies from 2002 to 2022. The results reveal that firms exposed to Western cultural values tend to maintain higher levels of cash holdings, driven by increased investment in innovation, and high dividend payout ratios. Furthermore, our findings indicate that the size and leverage of a firm diminish the positive impact of Western culture on cash holdings, with this positive influence being more pronounced in highly competitive industries and firms deeply influenced by Confucian culture. To test this hypothesis, we employed different proxy variables for Western culture to ensure the robustness of the results. Overall, the study offers valuable insights into the economic implications of Western cultural influence in East Asia from the perspective of cash holdings.

Keywords: Western culture; Cash holdings; China (search for similar items in EconPapers)
JEL-codes: D23 G32 Z13 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1057521925003679
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:104:y:2025:i:pa:s1057521925003679

DOI: 10.1016/j.irfa.2025.104280

Access Statistics for this article

International Review of Financial Analysis is currently edited by B.M. Lucey

More articles in International Review of Financial Analysis from Elsevier
Bibliographic data for series maintained by Catherine Liu ().