Why Has the Value of Cash Increased Over Time?

Product Market Threats and the Value of Corporate Cash Holdings

“…This is consistent with the findings in Bates et al. () that the value of cash has been increasing above $1.00 in the late 1990s and the 2000s. Recall from Table that fluidity and industry beta have a modest correlation of 0.15, yet both produce quite similar results.…”

“…The findings in Denis and Sibilkov () suggest that these firms likely have persistently low free cash flows and costly external financing. Bates, Chang, and Chi () document that the speed of adjustment to optimal cash levels has slowed in recent years, especially for firms with low cash holdings.…”

Evaluating Probabilistic Population Forecasts

“…The median levels of financial liquid asset ratios are nevertheless heteroge neous across activities, and the highest in sectors such as professional, scientific and technical services, information and communication and other services. These sectors have also expe rienced the highest increase in their financial liquid asset ratio, in line with the results of the literature (e.g., Opler et al, 1999;Bates et al, 2009) linking cash holding to intangible assets and financial frictions.…”

“…Size is a major determinant of financial liquid asset holdings. Both the relative position across size categories and the level of the ratios that we document are compa rable to what Bates et al (2009) evidenced in the US.…”

Bayesian Probabilistic Population Projections for France

“…Han & Qiu (2007) provide a theoretical foundation to this relationship when firms face financial constraints. Bates et al (2009) or Boileau & Moyen (2016) identify the increase in cash flow volatility (Campbell et al, 2001 andDichev &Tang, 2008 document this stylised fact) as one of the main factors explaining US firms' cash accumulation in the years 2000. To investigate the hedging need against foregone investment opportunities, some studies explore the effect of the correlation between cash flows and invest ment opportunities on cash hoarding.…”