{"title":"Stock market liberalisation and corporate cash holdings: evidence from China","authors":"Jianqiao Huang, Yunsen Chen, X. Dai, Xiaoran Ni","doi":"10.1111/acfi.12844","DOIUrl":null,"url":null,"abstract":"We examine the impact of stock market liberalization on corporate cash holdings using the sequential enactment of Mainland-Hong Kong Stock Connect Program as quasi-natural experiments. We find that stock market liberalization is associated with significant reductions in cash holdings. This effect mainly appears among firms with small managerial ownership, high separation of ownership and control, severe financial constraints, and limited investment opportunities. Overall, our study offers original evidence about how stock market liberalization in emerging economies affects firms’ liquidity management decisions.","PeriodicalId":45436,"journal":{"name":"Intelligent Systems in Accounting Finance & Management","volume":null,"pages":null},"PeriodicalIF":3.5000,"publicationDate":"2021-08-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1111/acfi.12844","citationCount":"8","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Intelligent Systems in Accounting Finance & Management","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1111/acfi.12844","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}
引用次数: 8
Abstract
We examine the impact of stock market liberalization on corporate cash holdings using the sequential enactment of Mainland-Hong Kong Stock Connect Program as quasi-natural experiments. We find that stock market liberalization is associated with significant reductions in cash holdings. This effect mainly appears among firms with small managerial ownership, high separation of ownership and control, severe financial constraints, and limited investment opportunities. Overall, our study offers original evidence about how stock market liberalization in emerging economies affects firms’ liquidity management decisions.
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