earticle

영어

This study examines the determinants of corporate cash holdings for casino firms. Based on a panel data of 409 firm-year observations obtained from 57 publicly traded US casino firms between 2002 and 2011, we run a weighted least squares regression model to identify the determinants of cash holdings. The study provides evidence that investment opportunities had a significant positive relationship with cash holdings, while firm size, leverage, capital expenditures, cash flow and the paying of dividends all had a negative relationship with cash holdings. Net working capital showed a negative relationship as well, but this result was not statistically significant. The results indicates that the trade-off theory has the most explanatory power for the casino industry’s cash holdings, implying that casino firms amass cash due to the precautionary motive and transaction motive, both of which deal with the difficulty and expense of the borrowing money in the future.