원문정보
초록
영어
This study empirically analyzes the effects of political corruption on corporate cash holdings policy and the impact of cash holdings on firm performance using 97 multinational data. We find that there is a nonlinear cubic function relationship between the political corruption and corporate cash holdings with a negative coefficient of cubic term of political corruption. Specifically, in developed countries with low levels of political corruption, there is a U-shape relationship between political corruption and cash holdings; however, in frontier and emerging countries, there is an Inverted-U-shape relationship. These results show that two hypothesis ‘Expropriation Shielding hypothesis’ and ‘Preoccupancy hypothesis’ on previous literature are not conflicting, but can be explained differently according to the level of development of countries and the level of political corruption. In addition, we find that the effects of political corruption on firm performance when firms use cash are different in developed and developing countries. From these results, we suggest that political corruption is an important variable in corporate financial policy and firm performance.
목차
1. Introduction
2. Literature Reviews and Hypothesis Development
2.1. Institutions, culture and firm financial policy
2.2. Corruption and firm financial policies
2.3. Hypothesis Development
3. Data and Variable descriptions
3.1. Financial variable data
3.2. Proxy of Political corruption.
3.3. Macro level variables
4. Research Model
4.1. Normal cash regression
4.2. The effect of political corruption on the operating performance in case of using cash
4.3. Identification Strategies for alleviate endogeneity problems in empirical tests
5. Empirical Results
5.1. Empirical Results in Normal Cash Regression
6. Conclusion
Reference