Productivity and liquidity management under costly financing

A Diversidade de Gênero Pode Afetar a Liquidez e o Risco de Companhias?

“…This result reflects Gill and Shah's (2012) findings, which affirmed that a larger boardroom can lead to an excessive cash holding in firms, consequently increasing the liquidity; however, possibly leaving aside the preferences of the shareholders. Tobin's Q (Q) was significantat the level of 5%, and an increase of 1% on it raises the liquidity in 0,02%, an expected result, being in accordance with John (1993) and Feng, Lu, and Wang (2017), suggesting that a higher growth opportunity will enhance the firm's liquidity. The cash flow risk (CFR) variable was also significant at 5%, and an increase of 1% in the variable increases the liquidity in 0,21%.…”

The Impact of Internal Financing on Productivity―An Empirical Study on Chinese Listed Manufacturing Firms

“…On the other, according to Feng, Lu, and Wang (2015), more productive firms actually hold larger cash flow and less capital than those with less productivity, which indicates an equilibrium. Feng argued that this concerns precautionary savings motivation under financial frictions.…”

The effect of productivity on liquidity under financial frictions

“…Moll (2014) and Buera, Kaboski, & Shin (2011) showed that financial frictions account for distortion of allocation resources. In developing countries, firms that have high productivity will have a higher level of liquidity than firms with low productivity (Restuccia & Rogerson, 2008, 2012Hopenyahn, 2011;Feng, Lu, & Wang, 2017). So the situation that occurs in developing countries is contrary to economic intuition.…”

“…For example, Hsieh & Klenow (2009) found that difference total factor productivity (TFP) in manufacturing sector between developed country (US) and developing countries (China and India) can be explained by different resource allocation. Feng, Lu, & Wang, (2017) using the Chinese data found that more productive firms tense to hold more liquid assets than less productive firms, even if liquid assets definitely gave a lower level of return. Feng, Lu, & Wang (2017) mentioned that the obstacles in developing countries are caused by the existence of idiosyncratic distortions and the existence of information asymmetry between creditors and debtors.…”

“…Feng, Lu, & Wang, (2017) using the Chinese data found that more productive firms tense to hold more liquid assets than less productive firms, even if liquid assets definitely gave a lower level of return. Feng, Lu, & Wang (2017) mentioned that the obstacles in developing countries are caused by the existence of idiosyncratic distortions and the existence of information asymmetry between creditors and debtors. They related their findings with the substantial external financing costs because the Chinese financial market is much less developed than that of the US.…”