The real and financial effects of internal liquidity: Evidence from the Tax Cuts and Jobs Act

• 成果类型: Article
• 署名作者: Albertus, James F.; Glover, Brent; Levine, Oliver
• 署名单位: Carnegie Mellon University; University of Wisconsin System; University of Wisconsin Madison
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2025.104006
• 发表日期: 2025
• 关键词: Tax Cuts and Jobs Act (TCJA); Corporate liquidity; Corporate cash holdings; corporate income tax; Multinational corporations; Worldwide tax system; Repatriation tax

摘要

The Tax Cuts and Jobs Act unlocked as much as $1.7 trillion of U.S. multinationals' foreign cash. We examine the real and financial response to this liquidity shock and find that firms did not increase capital expenditures, employment, R&D, or M&A, regardless of financial constraints. On the financial side, firms paid out only about one-third of the new liquidity to shareholders and retained half as cash. This high retention was not associated with poor governance. The high propensity to retain the liquidity shock as cash, even among well-governed firms with limited financial constraints, is difficult to reconcile with existing theory.