(Non-)Precautionary Cash Hoarding and the Evolution of Growth Firms

• 成果类型: Article
• 署名作者: Boot, Arnoud; Vladimirov, Vladimir
• 署名单位: University of Amsterdam; Center for Economic & Policy Research (CEPR)
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2018.3079
• 发表日期: 2019
• 页码: 5290-5307
• 关键词: cash hoarding; growth firms; public versus private financing; COMPETITION; Real options

摘要

We analyze whether growth firms should delay current investment to hoard cash in order to reduce dilution from external financing. This hoarding motive is the natural counterpart to saving cash as a precaution to help secure funding for future investment opportunities. However, the two motives lead to fundamentally different implications for hoarding and for how cash interacts with key financial and investment decisions. In particular, our paper contributes to understanding why firms choosing private over public financing hoard less, and why product market competition has an ambivalent impact on the public-private choice.