Do State Ownership and Political Connections Affect Precautionary Cash Holdings for Customer Concentration? Evidence from China
Shaorou Hu,
Ming Liu,
Nan Liu and
Xialin Guo
Abacus, 2024, vol. 60, issue 2, 305-337
Abstract:
This paper examines whether state ownership and political connections affect the relationship between customer concentration and cash holdings for Chinese listed manufacturing firms. We show that non‐state‐owned firms, but not state‐owned firms, hold more cash as customer concentration increases. In addition, political connections weaken the positive effect of customer concentration on non‐state‐owned firms’ cash holdings. Our supplemental analyses further show that for non‐state‐owned firms with limited access to finance—for instance, firms with low analyst following, low institutional ownership, or low government subsidies—the effects of political connections on weakening the positive association between customer concentration and cash holdings are more pronounced. Additional robustness tests support our arguments.
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:
Downloads: (external link)
https://doi.org/10.1111/abac.12303
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:bla:abacus:v:60:y:2024:i:2:p:305-337
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0001-3072
Access Statistics for this article
Abacus is currently edited by G.W. Dean and S. Jones
More articles in Abacus from Accounting Foundation, University of Sydney
Bibliographic data for series maintained by Wiley Content Delivery ().