Impacts of disease pandemics on corporate cash holdings: Evidence from US firms

dc.contributor.authorLartey, Theophilus
dc.contributor.authorDanso, Albert
dc.contributor.authorUddin, Moshfique
dc.contributor.authorBoateng, Agyenim
dc.date.acceptance2024-06-14
dc.date.accessioned2024-07-15T12:59:41Z
dc.date.available2024-07-15T12:59:41Z
dc.date.issued2024-06-14
dc.description.abstractPandemic disease outbreaks generate economic disruptions and impact on liquidity needs of firms. However, how pandemics affect liquidity management policies of firms has received relatively little attention. In this study, we examine whether U.S. firms hold more cash during disease pandemics. We find that U.S. firms increase their cash holdings in response to high disease pandemic exposure. The increase is more pronounced for firms that are small, young, or highly exposed to the uncertainty through their greater reliance on government spending. However, expected cash holdings decrease significantly for firms with male CEOs, or more able (or specialist) CEOs who possess more specific rather than general knowledge of their business to make better judgements. In particular, holding more cash in the presence of high disease uncertainty alleviates the negative impact of disease pandemics on capital investment and corporate payout targets. Our findings demonstrate that cash holdings represent a vital channel in mitigating the negative effect of disease pandemics on firm strategic outcomes.
dc.funderNo external funder
dc.identifier.citationLartey, T., Danso, A., Uddin, M. et al. (2024) Impacts of disease pandemics on corporate cash holdings: Evidence from US firms. Review of Corporate Finance,
dc.identifier.issnISSN 2693-9312
dc.identifier.urihttps://hdl.handle.net/2086/24005
dc.peerreviewedYes
dc.publishernow publishers
dc.researchinstituteFinance and Banking Research Group (FiBRe)
dc.rightsAttribution-NonCommercial-NoDerivatives 4.0 Internationalen
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/4.0/
dc.subjectpandemic disease exposure
dc.subjectcash holding
dc.subjectgovernment support
dc.subjectlobbying
dc.subjectdividend payout
dc.subjectfirm investment
dc.titleImpacts of disease pandemics on corporate cash holdings: Evidence from US firms

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