CEO organizational identification and firm cash holdings
Meihua Zhou,Jian Cao,Bin Lin +2 more
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Zhang et al. as mentioned in this paper investigated the association between CEO organizational identification and firm cash holdings, and found that the negative association is more pronounced when the level of financial development is higher and economic uncertainty is lower.Abstract:
As the decision-makers and implementers of a firm’s financial strategy, executives play a critical role in cash holding activities, and their psychological characteristics have a major impact on cash holdings. This paper investigates the association between CEO organizational identification and firm cash holdings. The empirical results show that CEO organizational identification is negatively associated with firm cash holdings, and the negative association is more pronounced when the level of financial development is higher and economic uncertainty is lower. Further analysis reveals that the higher a CEO’s organizational identification, the higher the firm’s R&D investment and capital expenditure, and high CEO organizational identification can increase the value of firm cash holdings. Overall, our findings supplement the literature on organizational identification and cash holdings, and on the effect of executives’ psychological characteristics on corporate financial decision-making.read more
Citations
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Corporate Cash Holdings and National Culture: Evidence from the Middle East and North Africa Region
TL;DR: In this paper, the authors investigated to what extent cultural dimensions, based on Hofstede's model, can clarify differences in cash holding levels, and found that when uncertainty avoidance and masculinity decrease, cash holdings increase, whereas when power distance, long-term orientation, and individualism increase, the stock holdings increase correspondingly.
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References
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TL;DR: In this article, the authors draw on recent progress in the theory of property rights, agency, and finance to develop a theory of ownership structure for the firm, which casts new light on and has implications for a variety of issues in the professional and popular literature.
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Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers
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Social Identity Theory and the Organization
Blake E. Ashforth,Fred A. Mael +1 more
TL;DR: This article argued that social identification is a perception of oneness with a group of persons, and social identification stems from the categorization of individuals, the distinctiveness and prestige of the group, the salience of outgroups, and the factors that traditionally are associated with group formation.
ReportDOI
Financial Dependence and Growth
Raghuram G. Rajan,Raghuram G. Rajan,Raghuram G. Rajan,Luigi Zingales,Luigi Zingales,Luigi Zingales +5 more
TL;DR: This paper examined whether financial development facilitates economic growth by scrutinizing one rationale for such a relationship; that financial development reduces the costs of external finance to firms, and found that industrial sectors that are relatively more in need of foreign finance develop disproportionately faster in countries with more developed financial markets.
Posted Content
Financial Dependence and Growth
Raghuram G. Rajan,Luigi Zingales +1 more
TL;DR: This paper examined whether financial development facilitates economic growth by scrutinizing one rationale for such a relationship: that financial development reduces the costs of external finance to firms, and they found that industrial sectors that are relatively more in need of foreign finance develop disproportionately faster in countries with more developed financial markets.