 The effect of market competition on corporate cash holdings: An analysis of corporate innovation and financial constraintXiang Zhang and Han Zhou International Review of Financial Analysis, 2022, vol. 82, issue C Abstract: This study investigates the impact of market competition on corporate cash holdings. Specifically, we focus on the corporate innovation and financial constraint channels. Based on a sample of the Chinese stock market from 1998 to 2019, our empirical results show that cash holdings are negatively impacted by market competition, corporate innovation partially mediates this effect, and financial constraint exhibits full mediation. Moreover, the mediating effect of corporate innovation is moderated by financial constraints. Furthermore, the impact of market competition reveals an increasing trend as cash holdings increase with quantile regression. In addition, this impact is mitigated for state-owned enterprises, and firms with larger total assets are impacted to a lesser degree. Keywords: Market competition; Cash holdings; Chinese stock market; Corporate innovation; Financial constraints (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:82:y:2022:i:c:s1057521922001272 DOI: 10.1016/j.irfa.2022.102163 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 |
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