Corporate Cash Holdings: An Increasingly Important Issue in Corporate Finance?

C. Van Hulle and F. Schoubben

Review of Business and Economic Literature, 2011, vol. 56, issue 2, 180-206

Abstract: Recent studies show that cash holdings cannot be considered a mere byproduct of corporate financial decision making but is an integral part of the explicit or implicit risk management policies of firms. This paper first gives an overview of the corporate finance literature from the past few decades leading up to this latter insight. Secondly, this study provides novel empirical evidence on the motives and the determinants shaping corporate cash policy in large European listed and unlisted firms. The results show that the precautionary motive seems to outweigh the transaction cost, agency and predation risk motives of cash holdings. Finally, comparisons are drawn between our results and those based on US data. Interestingly, the differences between listed and unlisted firms appear less important than differences between US and European firms.

Date: 2011
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:sen:rebelj:v:56:i:2:y:2011:p:180-206

Access Statistics for this article

Review of Business and Economic Literature is currently edited by Hans Kluwer

More articles in Review of Business and Economic Literature from Intersentia
Bibliographic data for series maintained by Petra Van den Bempt ( this e-mail address is bad, please contact ).