Ownership Structure and Corporate Excess Cash Holdings
碩士 === 國立中正大學 === 企業管理研究所 === 99 === This research aims at investigate the correlations that how a firm’s ownership structures conduct its cash holding policy and then produce the performances. By means of specific speculation of the agency problem between controlling shareholder and minority shareh...
| Main Authors: | , |
|---|---|
| Other Authors: | |
| Format: | Others |
| Language: | en_US |
| Published: |
2011
|
| Online Access: | http://ndltd.ncl.edu.tw/handle/50192643803757650919 |
| Summary: | 碩士 === 國立中正大學 === 企業管理研究所 === 99 === This research aims at investigate the correlations that how a firm’s ownership structures conduct its cash holding policy and then produce the performances. By means of specific speculation of the agency problem between controlling shareholder and minority shareholders, the perspectives of ownership structure can be an effective denominator to examine the situation why firms hold so much excess cash, and extend the managerial discretion issue that the possibility for controlling shareholders to transfer the liquidity resource without fully used in investing opportunity. We observe 508 independent Taiwan listed firms during the period 2001-2009 and use econometric analysis of cross sectional panel data which is verified by Redundant FE test and Hausman test to prove the fixed effect model.
The empirical estimates report that cross-holdings structure may be one of the reasons that results in inefficient management of excess cash. Manager shareholdings provide the motivation to improve the future expectation of performance while board directors and supervisors will value more on current value that may imply the managerial myopic behavior. Our observations can be interpreted that cross-holdings structure can be a strategy for a firm to enhance its efficiency of management but it also enable the dominant shareholders in corporate with greater power to conduct the resource allocation where corporate governance should provide the mechanism to prevent the inappropriate resource transferring through cross-holdings structure and enhance the benefit of maintaining competitive advantage.
|
|---|