This paper investigates the empirical determinants of corporate cash holdings in the euro area as a function of firm size. The results show that there are significant differences in investment in liquid assets for firms of different size. More specifically, liquid assets for smaller firms in the...

The recent financial crisis has been characterized by unprecedented monetary policy interventions of central banks with the intention to stabilize financial markets and the real economy. This paper sheds light on the actual impact of monetary policy on stock liquidity and thereby addresses its...

This paper isolates the operation of the ECB’s balance-sheet channel (2003-2016) by assessing how high-frequency identified asset-price surprises affect firm-based cash-to-asset ratios conditional on the value of available collateral. It is found that positive surprises that enhance future...