Climate risk and corporate cash holdings: Evidence based on the tourism industry

Xianbing Ruan, Xiaodong Ji and Xiaoqin Li

Finance Research Letters, 2025, vol. 81, issue C

Abstract: This study explores the link between climate risk and tourism firms’ cash holdings. Using panel data from Chinese tourism companies (2013–2023), a multi-stage mediation model is employed for empirical analysis. Findings indicate that climate risk significantly increases cash holdings by heightening operational uncertainty and influencing investment decisions. Further analysis identifies tourism market volatility, environmental investment intensity, and climate adaptation capacity as key mediators. Robustness tests confirm these results, offering insights into the impact of climate risk on cash decisions.

Keywords: Climate risk; Tourism firm; Cash holdings; Operational uncertainty (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:81:y:2025:i:c:s1544612325006841

DOI: 10.1016/j.frl.2025.107424

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