CASH IS SURPRISINGLY VALUABLE AS A STRATEGIC ASSET

• 成果类型: Article
• 署名作者: Kim, Changhyun; Bettis, Richard A.
• 署名单位: University of North Carolina; University of North Carolina Chapel Hill
• 刊物名称: STRATEGIC MANAGEMENT JOURNAL
• ISSN/ISSBN: 0143-2095
• DOI: 10.1002/smj.2205
• 发表日期: 2014
• 页码: 2053-2063
• 关键词: Cash; SLACK; strategic deterrence; behavioral theory; Agency theory

摘要

Academics, politicians, and journalists are often highly critical of U.S. firms for holding too much cash. Cash holdings are stockpiled free-cash flow and incur substantial opportunity costs from the perspectives of economics. However, behavioral theory highlights the benefits of cash holdings as fungible slack resources facilitating adaptive advantages. We use the countervailing forces embodied in these two theories to hypothesize and test a quadratic functional relationship of returns to cash measured by Tobin's q. We also build and test a related novel hypothesis of scale-dependent returns to cash based on the competitive strategy concept of strategic deterrence. Tests for both of these hypotheses are positive and show that returns to cash continue to increase far beyond transactional needs. Copyright (c) 2013 John Wiley & Sons, Ltd.