Half Banked: The Economic Impact of Cash Management in the Marijuana Industry

• 成果类型: Article
• 署名作者: Berger, Elizabeth A.; Seegert, Nathan
• 署名单位: University of Houston System; University of Houston; Utah System of Higher Education; University of Utah
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/jofi.13364
• 发表日期: 2024
• 页码: 2759-2796
• 关键词: SMALL BUSINESS; financial intermediation; corporate-finance; demand; firm; identification; instruments; constraints; COMPETITION; distance

摘要

We investigate the economic value of cash management. In the legal marijuana industry, where only half of businesses have access to cash management services from a financial institution, we examine dispensary profitability using administrative and survey data. Our results show that businesses with cash management charge higher retail prices (8.3%), pay lower wholesale prices (7.3%), and have higher sales volume (19%). Together, these advantages create a 40% increase in profitability. These results support our model in which reputational capital and administrative costs drive profitability regardless of whether national banks, credit unions, or fintech provide the cash management functions.