The Cash Flow Sensitivity of Cash
We model a firm's demand for liquidity to develop a new test of the effect of financial constraints on corporate policies. The effect of financial constraints is captured by the firm's propensity to save cash out of cash flows (the cash flow sensitivity of cash). We hypothesize that constr...
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| Veröffentlicht in: | The Journal of finance (New York) 2004-08, Vol.59 (4), p.1777-1804 |
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| container_end_page | 1804 |
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| container_issue | 4 |
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| container_title | The Journal of finance (New York) |
| container_volume | 59 |
| creator | Almeida, Heitor Campello, Murillo Weisbach, Michael S. |
| description | We model a firm's demand for liquidity to develop a new test of the effect of financial constraints on corporate policies. The effect of financial constraints is captured by the firm's propensity to save cash out of cash flows (the cash flow sensitivity of cash). We hypothesize that constrained firms should have a positive cash flow sensitivity of cash, while unconstrained firms' cash savings should not be systematically related to cash flows. We empirically estimate the cash flow sensitivity of cash using a large sample of manufacturing firms over the 1971 to 2000 period and find robust support for our theory. |
| doi_str_mv | 10.1111/j.1540-6261.2004.00679.x |
| format | Article |
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We empirically estimate the cash flow sensitivity of cash using a large sample of manufacturing firms over the 1971 to 2000 period and find robust support for our theory.</description><subject>Bond rating</subject><subject>Business structures</subject><subject>Capital investments</subject><subject>Capital markets</subject><subject>Cash</subject><subject>Cash flow</subject><subject>Cash flow forecasting</subject><subject>Coefficients</subject><subject>Corporate liquidity</subject><subject>Corporate planning</subject><subject>Correlation analysis</subject><subject>Economic models</subject><subject>Financial investments</subject><subject>Financial performance</subject><subject>Investment policy</subject><subject>Studies</subject><issn>0022-1082</issn><issn>1540-6261</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2004</creationdate><recordtype>article</recordtype><recordid>eNqNkMtOwzAQRS0EEqXwBywC-4SxHT-yYIEq-kAVlaCo7EZx66gJpQE7pe3fkzSoa2ZjS2eOx3MJCShEtK67IqIihlAySSMGEEcAUiXR7oR0juCUdAAYCylodk4uvC-gKSE65Ga6tEEv9cugvyq3watd-7zKf_JqH5TZAVySsyxdeXv1d3bJW_9x2huG48lg1HsYh6kEloRSWKszmWXGWKHFnCVMA19IzbnVltJEpCoGZWDOF8YwQU0suEmT-o_aGADeJbftu1-u_N5YX2FRbty6Hok0iRWjQtC6SbdNc1d672yGXy7_TN0eKWCTBxbYrI3N2tjkgYc8cFer9626zVd2_28Pnyb9UX2r_evWL3xVuqPPZRJrpWsctjj3ld0dceo-UCquBM6eBziEdzV7kQo1_wWNlHud</recordid><startdate>200408</startdate><enddate>200408</enddate><creator>Almeida, Heitor</creator><creator>Campello, Murillo</creator><creator>Weisbach, Michael S.</creator><general>Blackwell Science Inc</general><general>Blackwell Publishers</general><general>Blackwell Publishers Inc</general><scope>BSCLL</scope><scope>AAYXX</scope><scope>CITATION</scope><scope>8BJ</scope><scope>FQK</scope><scope>JBE</scope></search><sort><creationdate>200408</creationdate><title>The Cash Flow Sensitivity of Cash</title><author>Almeida, Heitor ; Campello, Murillo ; Weisbach, Michael S.</author></sort><facets><frbrtype>5</frbrtype><frbrgroupid>cdi_FETCH-LOGICAL-a6029-65ee8f6ffbbe585c292803d6833e8e1195a7407b0c3dbb251b453ba95408bb003</frbrgroupid><rsrctype>articles</rsrctype><prefilter>articles</prefilter><language>eng</language><creationdate>2004</creationdate><topic>Bond rating</topic><topic>Business structures</topic><topic>Capital investments</topic><topic>Capital markets</topic><topic>Cash</topic><topic>Cash flow</topic><topic>Cash flow forecasting</topic><topic>Coefficients</topic><topic>Corporate liquidity</topic><topic>Corporate planning</topic><topic>Correlation analysis</topic><topic>Economic models</topic><topic>Financial investments</topic><topic>Financial performance</topic><topic>Investment policy</topic><topic>Studies</topic><toplevel>peer_reviewed</toplevel><toplevel>online_resources</toplevel><creatorcontrib>Almeida, Heitor</creatorcontrib><creatorcontrib>Campello, Murillo</creatorcontrib><creatorcontrib>Weisbach, Michael S.</creatorcontrib><collection>Istex</collection><collection>CrossRef</collection><collection>International Bibliography of the Social Sciences (IBSS)</collection><collection>International Bibliography of the Social Sciences</collection><collection>International Bibliography of the Social Sciences</collection><jtitle>The Journal of finance (New York)</jtitle></facets><delivery><delcategory>Remote Search Resource</delcategory><fulltext>fulltext</fulltext></delivery><addata><au>Almeida, Heitor</au><au>Campello, Murillo</au><au>Weisbach, Michael S.</au><format>journal</format><genre>article</genre><ristype>JOUR</ristype><atitle>The Cash Flow Sensitivity of Cash</atitle><jtitle>The Journal of finance (New York)</jtitle><date>2004-08</date><risdate>2004</risdate><volume>59</volume><issue>4</issue><spage>1777</spage><epage>1804</epage><pages>1777-1804</pages><issn>0022-1082</issn><eissn>1540-6261</eissn><coden>JLFIAN</coden><abstract>We model a firm's demand for liquidity to develop a new test of the effect of financial constraints on corporate policies. 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| identifier | ISSN: 0022-1082 |
| ispartof | The Journal of finance (New York), 2004-08, Vol.59 (4), p.1777-1804 |
| issn | 0022-1082 1540-6261 |
| language | eng |
| recordid | cdi_proquest_journals_194721551 |
| source | Jstor Complete Legacy; Wiley Online Library Journals Frontfile Complete |
| subjects | Bond rating Business structures Capital investments Capital markets Cash Cash flow Cash flow forecasting Coefficients Corporate liquidity Corporate planning Correlation analysis Economic models Financial investments Financial performance Investment policy Studies |
| title | The Cash Flow Sensitivity of Cash |
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