Human resource heterogeneity, hold-up and firm cash holdings

Purpose This paper aims to study the impact of human resource heterogeneity on firms’ cash-holding policies. Design/methodology/approach The authors construct a proxy for using dissimilarity in employees’ skill structure between firm and its peers same industry. Findings report evidence that firms with heterogeneous resources hold more cash than other firms. effect is pronounced labor-intensive susceptible hold-up by employees, i.e. located regions labor disputes surrounded external employment opportunities. In addition, demonstrate high holdings triggered reduce scale efficiency capital investment. Originality/value highlights role determining adds understanding adjustment costs within provides insights into decisions.