Advanced Search
MyIDEAS: Login to save this paper or follow this series

An Analysis of the Corporate Cash Holding Decision

Contents:

Author Info

  • D'Mello, Ranjan

    (Wayne State University)

  • Krishnaswami, Sudha

    (University of New Orleans)

  • Larkin, Patrick J.

    (Fayetteville State University)

Registered author(s):

    Abstract

    We investigate the tradeoff theory as an explanation for how managers allocate cash to post-spin-off parent and subsidiary firms. Spin-offs provide an opportunity to examine the determinants of cash holdings free from the confounding effects of the pecking order theory. Our results indicate that difference in asset size, sales growth, research and development expenses, net working capital, and leverage significantly affect the difference in cash holdings of post-spin-off entities. These results suggest that cash holdings are decreasing in the ease of raising cash and availability of cash from internal sources, and are increasing in growth opportunities, asymmetric information levels, and financial distress costs.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://louisdl.louislibraries.org/cgi-bin/showfile.exe?CISOROOT=/EFW&CISOPTR=34
    Our checks indicate that this address may not be valid because: 404 Page not found.. If this is indeed the case, please notify (Janet Murphy Crane)
    Download Restriction: no

    Bibliographic Info

    Paper provided by University of New Orleans, Department of Economics and Finance in its series Working Papers with number 2005-02.

    as in new window
    Length: 45 pages
    Date of creation: Nov 2005
    Date of revision:
    Handle: RePEc:uno:wpaper:2005-02

    Contact details of provider:
    Postal: New Orleans, Louisiana 70148
    Phone: (504) 280-6485
    Email:
    Web page: http://www.uno.edu/~coba/econ/index.html
    More information through EDIRC

    Related research

    Keywords: Trade-off theory; Spin-off; Cash holding;

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:uno:wpaper:2005-02. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Janet Murphy Crane).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.