Economic policy uncertainty and corporate cash holdings: the mechanism of capital expenditures

IF 1.4 4区经济学 Q3 BUSINESS, FINANCE

Asia-Pacific Journal of Accounting & Economics Pub Date : 2022-03-24 DOI:10.1080/16081625.2022.2054831

Xi Zhao, Teng Niu

引用次数: 3

Abstract

ABSTRACT This study investigates the relation between economic policy uncertainty (EPU) and cash holdings in China. We find that EPU is positively related to cash holdings. Based on the mediation analysis, our results suggest that capital expenditures represent an important mechanism by which EPU affects cash holdings. However, there are two different theories to explain the mechanism of capital expenditures. Our results are consistent with the precautionary theory, but not with the real options theory. That is, reducing capital expenditures in the presence of higher EPU means weakening investment demands that, in turn, lead to fewer precautionary cash holdings.

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经济政策不确定性与企业现金持有量:资本支出机制

摘要本研究探讨了中国经济政策不确定性与现金持有量的关系。我们发现EPU与现金持有量呈正相关。基于中介分析，我们的研究结果表明资本支出是EPU影响现金持有量的重要机制。然而，有两种不同的理论来解释资本支出的机制。我们的结果与预警理论一致，但与实物期权理论不一致。也就是说，在EPU较高的情况下减少资本支出意味着投资需求减弱，进而导致预防性现金储备减少。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Asia-Pacific Journal of Accounting & Economics Multiple-

CiteScore

2.40

自引率

9.10%

发文量

期刊介绍： The Asia-Pacific Journal of Accounting & Economics (APJAE) is an international forum intended for theoretical and empirical research in all areas of economics and accounting in general. In particular, the journal encourages submissions in the following areas: Auditing, financial reporting, earnings management, financial analysts, the role of accounting information, international trade and finance, industrial organization, strategic behavior, market structure, financial contracts, corporate governance, capital markets, and financial institutions. The journal welcomes contributions related to the Asia Pacific region, and targets top quality research from scholars with diverse regional interests. The editors encourage submission of high quality manuscripts with innovative ideas. The editorial team is committed to an expedient review process.