Firm Hold Research Articles

How do economic policy uncertainty and leverage impact firm-level cash holding distribution of housing companies in an emerging economy? A quantile regression approach

PurposeHigh economic policy uncertainty forces firms to accumulate a higher level of cash than during normal business periods. However, it is not evident that economic policy uncertainty has a homogeneous impact across cash-holding distributions. This paper aims to study the impact of economic policy uncertainty, leverage and their interaction on cash-holding distributions.Design/methodology/approachThis study adopted a quantile regression approach to examine the influence of economic policy uncertainty and firm leverage on firm-level cash-holding distributions. To investigate the influence across quantiles, the author estimated 19 quantiles between 0.05 and 0.95.FindingsThis study finds that both economic policy uncertainty and firm leverage significantly affect firm-level cash-holding distributions heterogeneously. But, the impact of the interaction of these two variables is significant only for firms placed in the 60th to 85th quantiles of cash holding distribution.Originality/valueThe study adds to the existing knowledge of determinants of firm-level cash holdings but takes exogenous variables as economic policy uncertainty. The paper builds on a unique sample setting wherein, the cash holdings of all nonfinancial firms have increased many folds, including housing companies in an emerging economy.

The impact of air pollution on cash holdings of firms in Vietnam

Cash holding is an important decision that affects many other choices in a firm. Previous studies have revealed a range of factors affecting cash holdings, but little is known about a macro variable: air pollution, which is quite a pressing issue recently and globally. This study examines the association between air pollution and cash holdings using a sample of listed firms in Vietnam, a developing country that has a worrisome level of air pollution. The research sample covers non-financial firms listed on the Vietnam Stock Exchange from 2016 to 2021, retrieved from Thomson Refinitiv. Furthermore, the authors also gather information on air pollution using the particulate matter measurement index (PM2.5) over the years 2016 to 2021 from the contribution of General Consulate of U.S. in Vietnam. The current research employs conventional estimation strategies including OLS, Fixed effects model, and Random effects model. In contrast to previous studies suggesting a positive linkage, we find that air pollution is not significantly related to cash holdings of firms in Vietnam. This could be due to the own situations in Vietnam and that air pollution could reduce (risky) investments. We further find that leverage tends to make air pollution have a more negative effect on cash holdings for firms in Vietnam. The findings bring important implications, and are robust to several techniques to ensure the robustness of findings

The final battles in the surroundings of Ilirska Bistrica at the end of the Second World War

Two important road connections pass through the area of the municipality of Ilirska Bistrica: Trieste–Reka and Ljubljana–Rijeka, which continues South along the sea to Split and was the key to the Nazi control of the Croatian coast during the Second World War. They became even more important at the end of the war, when the Wehrmacht units began to retreat from Greece, Albania, Serbia and Croatia towards the borders of the Third Reich. The Wehrmacht needed to keep connections to the north cleaned and protected from Partisan ambushes blocking their way. For this reason, it was imperative for the Germans to maintain a firm hold on Ilirska Bistrica and the surrounding area until the arrival of their units from the South. The task was assigned to the 97th Army Corps (97. Armeekorps) under the command of Ludwig Kübler, which engaged the 4th Army of Yugoslav Partisans pressing for a rapid advance to occupy Trieste. The fighting that ensued constituted one of the major battles in Slovenia.

Employees’ service recovery performance: the role of functional manager’s emotional intelligence in the hospitality industry

Emotional intelligence has taken a firm hold in organizations. The emotional intelligence of managers is essential for building a motivated workforce. This study investigates the relationship between functional managers’ emotional intelligence and employees’ service recovery performance in the context of the hospitality industry. In this study, functional managers’ emotional intelligence includes four dimensions: self-emotion appraisal, other-emotion appraisal, use of emotion, and regulation of emotion. A mixed method was employed to explore the influence of functional managers’ emotional intelligence on employees’ service recovery performance. The data were collected from 238 functional managers at 33 four- and five-star hotels in five provinces and cities in Vietnam. Factor analysis, correlation analysis, and regression analysis were used to analyze the data. The results show that functional hotel managers’ emotional intelligence has a positive and significant impact on employees’ service recovery performance, with others’ emotion appraisal having the strongest impact, followed by emotion regulation, use of emotion, and self-emotion appraisal. These findings contribute to the literature and deepen the understanding of service recovery. This study also provides managers with useful advice on managing customer service as a competitive advantage.

Emissions trading scheme participation and firms’ cash holdings

This study investigates the effect of participating in an emissions trading scheme (ETS) on firms' future cash holdings. Using global firm-level data from different continents, our findings show that, notwithstanding the benefits of ETS, its membership has a significant impact on firms' cash holding. Additionally, we document that bankruptcy risk, firm growth potential, corporation tax, and financial constraints mitigate the impact of ETS on corporate cash holdings. Furthermore, we find that the country of operations, continent, and legal origin of the domiciled firm influence the association between ETS and firm cash holdings level. The results are robust to difference in differences (DiD) estimation and a variety of econometric specifications.

The Missing Nexus: A Historical and Contemporary Position of the United States on Climate Change Action

The international system is unstable due to the absence of a global regulating body, but countries are sovereign and independent. Although intergovernmental and multilateral organizations exist, there is no world government to regulate the behaviour of nations. In such an environment, states are highly concerned about their security and domestic interest over the idea of climate justice. However, the United States, with a firm hold on the economy, repeatedly refuses to take a suitable stand, from Kyoto to the Paris Accord, for reducing its greenhouse gas (GHG) emissions and endlessly demands the developing world’s engagement in climate action. The US’s withdrawal from the Paris Agreement shocked world leaders and criticized the stand of President Trump’s backpaddling, which setback climate action. It influences global emissions, at least for the time being, forcing developing economies to reduce their standard of emissions extensively. Significantly, how conscious is the United States of climate justice? How fast will the United States come back in acting the jeopardy of climate change? This article reviews the US action, shifting governments’ policy and stands on climate change from Rio Earth Summit 1992 to Glasgow Climate Accord 2021 conditions. The author has taken the 1992 to 2021 period, a blueprint for crucial climate action decided in 1992 led to the formation of UNFCCC, while the United States has re-engaged in the Paris Accord in 2021. Also, it tries to understand the shift across federal governments and the influence of local governments on climate change. Furthermore, it sheds light on the obscure image of the United States on carbon trading and tax subsidies for GHGs.

Do CEO characteristics impact corporate cash holdings? Insights from consumer goods companies listed on the Indonesia Stock Exchange

This study aims to determine the effects of CEO characteristics on the corporate cash holdings of consumer goods industry firms listed on the Indonesia Stock Exchange from 2017–2021. The data used in this study were taken from annual reports of firms in consumer goods industry sectors published by the Indonesia Stock Exchange from 2017–2021. This study utilized a purposive sampling technique to obtain 210 observations. The research model used is an unbalanced panel data analysis with a fixed-effect model approach. The results show that gender diversity, CEO age and CEO education have positively associated with corporate cash holdings. However, CEO tenure has no a significant effect with corporate cash holdings

A Suction-Powered Elastic-Strap Gripping Device

In recent decades, there has been an increasing need for robotic gripping device capable of sensitively handling things of varied forms. While classic finger-shaped gripping devices are adaptable and can grab a broad variety of things, achieving a firm hold without slippage demands precise alignment of the fingers on the object. This study offers the notion of a ring-like delicate gripper that wraps across items much resembles an elastic string. The implied gripper is constructed of a flexible tube having layers of sponges interspersed with plastic sheets. By emptying the air inside the sponges, they contract, lowering the ring's diameter and permitting a tight grasp on things. This endows the gripper with the flexibility to wrap around items of varied forms flawlessly, leaving no opportunity for gaps. Moreover, the hardness of the compressed sponges inside the gripper mitigates any possible swaying of the grabbed items. Airborne particles inside The device that grips may be modified to fine-tune the grabbing energy. After air is emptied from the sponges, the gripper's minimal diameter is roughly one-fourth of its initial size. Consequently, our suggested gripper is set to find applications across a range of sectors, giving the potential to simply and firmly hold things while seamlessly adjusting to their various forms.

Executive compensation controls and corporate cash holdings.

As a crucial component of internal corporate governance, remuneration controls possess the potential to influence the cash holdings of firms. However, identifying the causal relationship between these controls and such holdings presents a considerable challenge. To address this research gap, this paper leverages the implementation of China's Guidance on Further Regulating the Remuneration Management of Heads of Central Enterprises as a quasi-natural experiment to investigate the relationship between executive remuneration controls and firms' cash holdings, utilizing a double-difference approach. Based on an analysis of a sample of listed companies from 2007-2012, the results indicate that firms subject to regulated executive compensation exhibit lower cash holdings. To ensure the robustness of these findings, various statistical techniques such as parallel trend tests, variable replacement, propensity score matching, and placebo tests were employed. Additionally, a mechanism test was conducted, whereby the mediating effect of executive compensation controls on firms' cash holdings was examined, revealing a reduction in internal agency costs. Finally, the analysis of heterogeneity demonstrated that the impact of executive compensation controls on firms' cash holdings was more pronounced in companies with high-quality internal controls, stronger management oversight, and lower information asymmetry.

Cash holdings and firm value: Evidence for increasing marginal returns

Cash is an important strategic asset for firms and scholars have a longstanding interest in the optimum level of a firm's cash holdings. In this study, we revisit the relationship between cash holdings and firm value by conducting a re-examination of Kim and Bettis , who hypothesized and found positive but decreasing marginal returns of cash. We argue and demonstrate that the regression model configuration of Kim and Bettis leads to distorted regression results. Once we adjust their regression model configuration, our results show that the benefits of cash do not diminish but instead increase with increasing cash holdings. In further analyses, we find indicative evidence that these results may be driven by firms with very high investment opportunities. We also employ a larger sample over a longer period of time to corroborate the time generalizability of our findings, we perform several checks to establish their robustness, and we discuss their theoretical implications.

Role of Flexible Bronchoscopy using Biopsy Forceps as the Initial Attempt for Headscarf Pin Aspiration Extraction.

Flexible bronchoscopy is a less invasive procedure for extracting foreign bodies from the airways. However, studies on the extraction of headscarf pins are still very limited to determine the efficacy and safety of headscarf pin extraction using flexible bronchoscopy with biopsy forceps. This retrospective study was conducted at Persahabatan Hospital, Jakarta, Indonesia, on patients who had been treated in this hospital for headscarf pin extraction between January 2013 and February 2023. Fibreoptic bronchoscopy was performed under general anaesthesia. The pin was removed using Radial Jaw 4 mm single-use pulmonary biopsy forceps. The impacted sharp tip of the pin was freed first, and the proximal part of the pin body was gripped using biopsy forceps. Once a firm hold of the sharp end or the proximal part of the pin was secured, the bronchoscope and forceps were both slowly withdrawn under direct vision. Thirty-two cases with headscarf pin aspiration were managed by fibreoptic bronchoscopy. A total of 12 patients (37.5%) came without any respiratory complaints; however, an equal number complained of cough and 6 cases (18.7%) of haemoptysis. All the cases in which the pins were visible in the airway were found with the round head down and the sharp tip oriented superiorly in the airway and impacted in the mucosa. Fibreoptic bronchoscopy extraction succeeded in 31 cases (96.8%). Only one case was converted to surgery. There were no major complications. Fibreoptic bronchoscopy with biopsy forceps under general anaesthesia is safe and effective for the removal of headscarf pin aspiration.

Does CEO risk-taking entrepreneurial spirit matter in firm cash holdings?

ABSTRACT The psychological factors of senior executives have an important impact on the firm’s financial policies. In this paper, we investigate the association between CEO risk-taking entrepreneurial spirit and firm cash holdings, and find that firms with higher CEO risk-taking entrepreneurial spirit have less cash holdings. Further, we find that financing constraints can mitigate the negative association between CEO risk-taking entrepreneurial spirit and firm cash holdings, whereas financing needs enhances the association between them. Mechanism test illustrates that CEO risk-taking entrepreneurial spirit affects firm cash holdings through corporate investment. Finally, the results reveal that CEO risk-taking entrepreneurial spirit not only promotes the value of cash holdings, but also is significantly positively associated with both accounting performance and market performance. Our findings shed lights on the impact of executive psychological factors on financial decisions and have important implications for cash-holding decisions of listed firms.

Investment Opportunity, Institutional Ownership, and Excess Cash Holdings with Financial Constraint as Moderation

This study examines the effect of investment opportunity and institutional ownership on excess cash holdings with financial constraint as the moderating variable. Holding more cash is often rated as a negative signal for shareholders, because of the probability to use the cash inappropriately and increase the agency cost. Another side, excess cash can give a good impact on the company when is more expensive to access the external financing, or the situation make the firm had financial constraints. This study uses excess cash holdings as a dependent variable with few references and a high chance for further research. Generalized least square (GLS) is employed to analyze the hypothesis with observations during 2015-2020 in listed companies on Indonesia Stock Exchange (IDX). The result of this research shows that investment opportunity has a positive influence on excess cash holdings. If there is a financial constraint, it will decrease the effect of Investment opportunity to the level of excess cash holdings. This study was unable to capture the impact of institutional ownership on excess cash holdings in constraint nor unconstraint firms. The study was robust enough when the proxy of excess cash changed and when using the lag variable to confirm the primary result.

Should Firms Hold More Patents? A Randomized Control Trial on the Commercial Value of Patents

Should Firms Hold More Patents? A Randomized Control Trial on the Commercial Value of Patents

Economic policy uncertainty and corporate leverage - does cash holdings matter? Evidence from the U.S.

This research study examines the mediating role of cash holdings between the economic policy uncertainty (EPU) and corporate leverage relationship. Using stepwise regression analysis and annual firm-level data of 2,534 U.S. firms listed at NYSE over 1995–2018, we provide novel evidence that cash holdings significantly and partially mediate the EPU-leverage relationship, accounting for a 10.72% increase in the corporate leverage during EPU. We discover that the mediating role of cash holdings between EPU and leverage is sensitive to firm-level heterogeneity. Also, the mediating effect of cash holdings remains significant based on long- and short-term leverage. Finally, our findings are robust to outliers’ effect, alternate EPU measurement, endogeneity concerns and sample-selection bias. The findings of this study highlighted the role of firm cash holdings in a firm’s leverage decision during economic uncertainty and recommends increasing debt financing to incentivize value-increasing decisions and mitigate agency problems by reducing the cost of free cash flows. Policymakers should be aware of public and private firms’ challenges during high EPU. As we showed in this study, firms have to adjust their financial decisions during high economic uncertainty. Also, the study suggests that policymakers should maintain economic policies to avoid external shocks that may force firms to adjust their financial decision-making.

Environmental information transparency and green innovations

Extending the theory of exclusionary ethical investing, we model that environmental information transparency (EIT) reduces green investors’ screening costs of identifying acceptable and unacceptable firms, resulting in more holdings of acceptable firms by green investors. This incentivizes polluting firms toward green transformation because of the lower cost of capital caused by green investors’ shareholdings. Empirically, we use a Pollution Information Transparency Index (PITI) as a proxy for the EIT, finding that PITI is positively related to firms’ green innovations. Given the critical social importance of motivating green innovation, our results are of great interest for policy makers and regulators.

International trade friction and firm cash holdings

In 2017, the United States launched a "301″ investigation, imposed a series of additional tariffs on China, which led to the US-China trade war. In this paper, we investigate the impact of the trade war on firms' cash holdings in the context of China. Our results indicate that the trade frictions have significantly increased cash holdings of manufacturing firms. This effect arises mainly through the channel if increased trade policy uncertainty. Our findings offer direct evidence and guidance for both firm strategy and policymakers in the important trade friction.

Cash holdings in sharia-compliant firms: Empirical evidence from Moroccan listed companies

Cet article vise à évaluer dans quelle mesure la conformité à la charia et certains indicateurs économiques et financiers spécifiques aux entreprises affectent leur niveau de liquidité et à examiner leur impact global. Cette étude est importante à la fois pour la littérature sur la finance islamique et plus généralement pour la littérature sur la finance d’entreprise. Pour ce faire, 42 entreprises cotées à la Bourse de Casablanca ont été sélectionnées. Douze années de données financières ont été considérées, de 2007 à 2019, et des modèles d’estimation de données de panel ont été appliqués pour effectuer l’analyse. Nos résultats sont relativement concluants ; ils montrent que les entreprises conformes à la charia ont des niveaux de liquidités significativement plus élevés que les entreprises non conformes à la charia. En ce qui concerne les déterminants économiques et financiers, nos résultats montrent des preuves d’une forte relation positive entre les liquidités et les flux de trésorerie ainsi que les opportunités de croissance. Nous avons ensuite constaté que les liquidités de ces entreprises sont significativement affectées négativement par la taille de l’entreprise, les besoins en fonds de roulement et l’effet de levier de la dette de l’entreprise.

Financial Flexibility and Firm Behavior: Evidence from Emerging Market

investment opportunities that increase shareholder value. Therefore, the purpose of this study is twofold: to explore the difference in characteristics of financially flexible firms from non–flexible firms. Secondly, to investigate the effects of this flexibility on financial decisions and the value of a firm. The sample is drawn from the KSE100-indexed firms listed at the Pakistan Stock Exchange, showing 80 percent of the market capitalization. The data is collected for eight years from 2015-2022. The ordinary least square regression with year and industry fixed effect is used to estimate the proposed hypotheses. The results of the study revealed that financial flexibility has a significant and positive effect on the profitability, dividend payout, and cash holdings of Pakistani firms. At the same time, it significantly negatively influences the firm's value and investment ability. The results reveal a significant difference between financially flexible firms. FF firms have higher ROA, cash holdings, and dividend payout than non-FF firms and lower leverage ratios than non-FF firms. Financial decision-making has a significant effect on the firm value. The consequences of maintaining financial flexibility or low leverage below the optimal debt level remain a puzzle. The financial markets need to improve, which provides more debt and equity securities for firms to improve their financial mix. The stock market improvement also adds to the emerging market's economic health. This study added to the limited literature on financial flexibility or low-leverage puzzle in the emerging market. The results prove that listed firms maintain their debt capacity to avoid future uncertainty when profitable investments are available.

Board characteristics and corporate cash holding: evidence from the UK, France and Germany

PurposePrior studies suggest that corporate cash holding will reflect firms' corporate governance (CG) environment. Consistent with this prediction, this study aims to examine the impact of board characteristics on firms' cash holding in the UK, France and Germany.Design/methodology/approachUsing 2,805 firm-year observations between 2009 and 2019, the authors examine the relationship between board characteristics and corporate cash holding. The authors used two measures of cash holdings as our dependent variables. As independent variables, the authors used CG characteristics relevant to effective board monitoring such as board meetings, outside directors, board size and board gender diversity.FindingsThe authors find that board characteristics influence firms' cash holdings of firms in the UK, France and Germany. However, this study documents evidence of varying impacts of board monitoring on the cash holding of the UK when compared to German and French firms, the countries that are classifiable as bank-based economies. The result of this study is robust to alternative cash-holding measures and endogeneity.Practical implicationsThis study provides evidence supporting the board's impact in mitigating agency conflict in shareholder- and stakeholder-oriented CG environments.Originality/valueThis study contributes to previous works on firms’ financial orientation by showing that the impact of board characteristics on corporate cash holdings varies between bank- and market-based economies.