The restrictions of a shariah-compliant index could have consequences for corporate finance. This research investigates the difference in cash holding policies between and conventional firms Indonesia capital market. Our empirical results suggest that firm holds significantly less compared to firm. finding still maintains after excluding top performers market controlling other proxies holdings ...

We investigate the economic factors driving the unprecedented rise of corporate liquidities since the 1970s. We document that US firms face higher earnings volatility and manage this increased risk with more liquidities in terms of both cash savings and credit lines. The rise in liquidities is not attributable to the increased sales volatility. The higher earnings volatility along with the fina...

The introduction of credit default swaps (CDS) trading on an underlying firm may influence its future access to external financing and, hence, its precautionary demand for cash. In this paper, we empirically estimate this effect of CDS trading, using a comprehensive sample of North American corporate CDS introductions between 1997 and 2009. We show that corporate cash holdings, as a proportion ...

I explore the role of the Just-in-Time (JIT) inventory system in the increase of cash holdings among U.S. manufacturing firms. I first demonstrate the empirical importance of JIT in shaping cash policy. I then develop a model to analyze the mechanism through which JIT affects cash and quantify its impact. In the model, both cash and inventory can serve as working capital. As firms switch from t...

We examine the impact on firm cash holdings of uncertainty uncertainty, measured as ex post volatility economic policy uncertainty. Using news-based index developed by Baker et al. (2016) for twenty-two countries, we find that, when there is greater firms hold more cash. Our results are robust to controlling a host firm-level and country-level factors. Consistent with (2016), consider that less...

In this paper, we extend corporate disclosure and cash holdings literature by testing whether voluntary risk affects for a sample of Tunisian non-financial listed companies. As measure disclosure, use manual content analysis to count the number risk-related sentences in narrative sections annual reports. holdings, ratio equivalent over total assets. Using 140 firm-year observations period 2008–...