We investigate the firms' specific attributes that determine the difference in speed of adjustment (SOA) towards the cash holdings target in the Scandinavian countries: Denmark, Norway and Sweden. We examine whether Scandinavian firms maintain an optimal level of cash holdings and determine if the active cash holdings management is associated with the firms' higher SOA and lower adjustment costs. Our findings substantiate that a higher level of off-target cost induces professional managers to rebalance their cash level towards the optimal balance of cash holdings. Our results reveal that Scandinavian firms accelerate SOA towards cash targets primarily for the precautionary motive. Moreover, our results show that SOA is heterogeneous across Scandinavian firms based on adjustment cost and deviate cash holdings towards the target mainly with the support of internal financing. Furthermore, our empirical findings show that the SOA of Norwegian firms is significantly higher than the Danish and Swedish firms.
机构:
Department of Finance, University of Illinois at Chicago, Chicago, IL, 60607, 2416 University HallDepartment of Finance, University of Illinois at Chicago, Chicago, IL, 60607, 2416 University Hall
Arslan-Ayaydin Ö.
Florackis C.
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机构:
The Management School, University of Liverpool, LiverpoolDepartment of Finance, University of Illinois at Chicago, Chicago, IL, 60607, 2416 University Hall
Florackis C.
Ozkan A.
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机构:
Department of Accounting and Finance, Business School, University of Hull, HullDepartment of Finance, University of Illinois at Chicago, Chicago, IL, 60607, 2416 University Hall
机构:
Univ Texas Dallas, Naveen Jindal Sch Management, Dept Accounting, Richardson, TX 75080 USAWestern Kentucky Univ, Gordon Ford Coll Business, Dept Finance, Bowling Green, KY 42101 USA
Bao, Dichu
Chan, Kam C.
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机构:
Western Kentucky Univ, Gordon Ford Coll Business, Dept Finance, Bowling Green, KY 42101 USAWestern Kentucky Univ, Gordon Ford Coll Business, Dept Finance, Bowling Green, KY 42101 USA
Chan, Kam C.
Zhang, Weining
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机构:
Cheung Kong Grad Sch Business, Beijing 100738, Peoples R ChinaWestern Kentucky Univ, Gordon Ford Coll Business, Dept Finance, Bowling Green, KY 42101 USA
机构:
Department of Finance, University of Illinois at Chicago, Chicago, IL, 60607, 2416 University HallDepartment of Finance, University of Illinois at Chicago, Chicago, IL, 60607, 2416 University Hall
Arslan-Ayaydin Ö.
Florackis C.
论文数: 0引用数: 0
h-index: 0
机构:
The Management School, University of Liverpool, LiverpoolDepartment of Finance, University of Illinois at Chicago, Chicago, IL, 60607, 2416 University Hall
Florackis C.
Ozkan A.
论文数: 0引用数: 0
h-index: 0
机构:
Department of Accounting and Finance, Business School, University of Hull, HullDepartment of Finance, University of Illinois at Chicago, Chicago, IL, 60607, 2416 University Hall
机构:
Univ Texas Dallas, Naveen Jindal Sch Management, Dept Accounting, Richardson, TX 75080 USAWestern Kentucky Univ, Gordon Ford Coll Business, Dept Finance, Bowling Green, KY 42101 USA
Bao, Dichu
Chan, Kam C.
论文数: 0引用数: 0
h-index: 0
机构:
Western Kentucky Univ, Gordon Ford Coll Business, Dept Finance, Bowling Green, KY 42101 USAWestern Kentucky Univ, Gordon Ford Coll Business, Dept Finance, Bowling Green, KY 42101 USA
Chan, Kam C.
Zhang, Weining
论文数: 0引用数: 0
h-index: 0
机构:
Cheung Kong Grad Sch Business, Beijing 100738, Peoples R ChinaWestern Kentucky Univ, Gordon Ford Coll Business, Dept Finance, Bowling Green, KY 42101 USA