in a firm's leverage decision during economic uncertainty and recommends increasing debt financing to incentivize value … corporate leverage relationship. Using stepwise regression analysis and annual firm-level data of 2,534 U.S. firms listed at … NYSE over 1995-2018, we provide novel evidence that cash holdings significantly and partially mediate the EPU-leverage …

-specific data from the Bureau of Economic Analysis, we find that firms with high tax-induced foreign cash have approximately 3 ….3 percent higher domestic liabilities relative to other multinationals, equivalent to $152.2 million more domestic debt per firm …, or approximately $98.9-$141.9 billion in aggregate. We next examine motives for firms with tax-induced foreign cash to …

Dividends are taxed at the investor level, but injecting funds into firms does not offer investors the symmetric tax … benefit. Hence, there is a tax saving incentive to retain cash in the firm. We theoretically and empirically show that this … tax saving motive is important for corporate cash holdings. We develop a dynamic corporate finance model of liquidity …