Using staggered board reforms as a quasi-natural experiment and a difference-in-differences approach, this study examines the impact of corporate governance on cash holdings in 41 countries. We find that board reforms are followed by significant reductions in cash holdings. This effect is more...

Using a unique sample of newly privatized firms from 59 countries, this study provides new evidence about the agency costs of state ownership and new insight into the corporate governance role of country-level institutions. Consistent with agency theory, we find strong and robust evidence that...

We empirically investigate the effect of economic policy uncertainty (EPU) on corporate cash holdings using a large sample of international firms. EPU intensifies concerns of investors on managerial self-dealing and political extraction. Consequently, the potential cost of cash holdings (i.e.,...

We explore the forces that drive cash savings in equity issuance using the average cash-savings rate instead of the marginal cash-savings rate that overstates individual issuers’ cash savings. Equity issuers with high investment opportunities save more cash in anticipation of greater cash...

This paper investigates the governance role of multiple large shareholders (MLS, henceforth), as evidenced by their impact on the valuation of cash holdings. For a sample of 2,723 firms from 22 countries, we find that the presence of MLS enhances the valuation of firms' cash holdings. In...

In this international study, we explore the benefits of strong institutions (or the perils of weak institutions) through the lens of equity issuance. We posit that strong governance—e.g., rule of law, control of corruption and shareholder rights—does not necessarily confer benefits on the...

We study the impact of board reforms implemented in 40 countries worldwide on corporate dividend policy. Using a difference-in-differences analysis, we find that firms pay higher dividends following the reforms. The increase in dividend payouts is more pronounced for firms with weak board...