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- W1636993908 abstract "Theory holds that knowledge has positive economic consequences. While US corporations defend record high level cash holdings citing the precautionary motive in response to changing firm characteristics, I find that knowledge-based innovation can partially explain these changes. Using distance to the nearest research university as a measure of knowledge intensity, I show that knowledge-intensive firms hold more cash, even after controlling for firm R&D. Moreover, knowledge-intensive firms exhibit higher marginal value of cash and save more cash from cash flows than their less knowledge-intensive counterparts. Overall, the precautionary motive appears to dominate the agency motive, with the effect of knowledge on cash holdings strengthening over time. Copyright © 2014 ASAC. Published by John Wiley & Sons, Ltd." @default.
- W1636993908 created "2016-06-24" @default.
- W1636993908 creator A5010799736 @default.
- W1636993908 date "2014-01-23" @default.
- W1636993908 modified "2023-09-27" @default.
- W1636993908 title "Why do firms hold so much cash? An innovation explanation" @default.
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- W1636993908 doi "https://doi.org/10.1002/cjas.1273" @default.
- W1636993908 hasPublicationYear "2014" @default.
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