Browsing by Author "Rhee, S. Ghon"
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Item Restricted Economic Policy Uncertainty And Corporate Cash Holdings(Te Herenga Waka—Victoria University of Wellington, 2017) Duong, Huu Nhan; Nguyen, Justin Hung; Nguyen, My; Rhee, S. GhonWe find that economic policy uncertainty is positively related to cash holdings. This positive relation is attributed to financial constraints that emerge as a new and dominating channel through which policy uncertainty affects corporate financing policies. Neither a delay in investment nor a reduction of the disciplining effect from M&A activities explains this positive relation. Increasing cash holdings during the period of high policy uncertainty contributes to firm excess returns and mitigates the negative impact of policy uncertainty on investment.