How does political uncertainty affect firms' saving? We incorporate election uncertainty into a dynamic model of firm investment and saving. Our model predicts that firms build up pre-election cash balances and, because cost of capital is high when uncertainty is high, begin to rely on this...

What factors determine a firm's cash holdings has been a popular topic of research in finance, especially in light of surging cash holdings by US corporations in recent years. The bulk of such research has focused primarily on firm-specific factors occasionally sprinkled with macroeconomic...

We develop a unified framework to connect cash holding, debt maturity and mergers and acquisitions. We provide empirical support for four internally consistent predictions: i) equity and debt values of highly distressed firms are more sensitive to cash reserve than those of healthy firms; ii)...