Table 6. Economic significance of...

Table 6.

Economic significance of results

Dependent variable	Cash	CashTo NetAssets	Cash	CashTo NetAssets	Cash	CashTo NetAssets
Sample	All		Labor-intense firms		Domestic firms
Economic significance	Elasticity: dy/dx $\times$ (Ø[x]/Ø[y])
	(1)	(2)	(3)	(4)	(5)	(6)
LMR	–0.110	–0.257	–0.202	–0.560	–0.388	–0.743
LMR#FFF	0.193	0.386	0.404	0.802	0.543	1.148
LMR $+$ LMR#FFF	0.083	0.129	0.202	0.243	0.155	0.405
FFF	–0.041	–0.078	–0.090	–0.191	–0.140	–0.341
Size $_{(t - 1)}$	–2.156	–2.214	–2.126	–3.035	–2.249	–1.644
Growth $_{(t - 1)}$	0.052	0.121	0.042	0.063	0.060	0.207
Leverage $_{(t - 1)}$	–0.125	–0.180	–0.125	–0.137	–0.140	–0.197
NWC $_{(t - 1)}$	–0.006	–0.012	–0.005	–0.007	–0.003	–0.007
Investments $_{(t - 1)}$	–0.031	–0.048	–0.032	–0.051	–0.033	–0.024
Dividends $_{(t - 1)}$	0.021	0.022	0.014	0.015	0.017	–0.002
Cash flow $_{(t - 1)}$	0.003	0.002	0.001	0.004	0.003	0.003
Cash flow volatility $_{(t - 1)}$	0.006	0.014	–0.001	0.005	0.007	0.016
Other ultimate owner	0.002	0.008	0.011	0.014	–0.006	–0.013
Inflation $_{(t - 1)}$	–0.008	0.005	–0.009	–0.009	0.012	0.041
GDP growth $_{(t - 1)}$	–0.003	–0.001	–0.001	–0.003	–0.001	–0.003
ln(GDP p.c.) $_{(t - 1)}$	6.285	2.978	5.175	13.163	0.694	0.761
Firm fixed effects	Yes	Yes	Yes	Yes	Yes	Yes
Industry-Year fixed effects	Yes	Yes	Yes	Yes	Yes	Yes
Country specific year trend	Yes	Yes	Yes	Yes	Yes	Yes
Clustered standard errors	Country-level	Country-level	Country-level	Country-level	Country-level	Country-level
Observations	28,113	28,113	12,098	12,098	7,027	7,027

Dependent variable	Cash	CashTo NetAssets	Cash	CashTo NetAssets	Cash	CashTo NetAssets
Sample	All		Labor-intense firms		Domestic firms
Economic significance	Elasticity: dy/dx $\times$ (Ø[x]/Ø[y])
	(1)	(2)	(3)	(4)	(5)	(6)
LMR	–0.110	–0.257	–0.202	–0.560	–0.388	–0.743
LMR#FFF	0.193	0.386	0.404	0.802	0.543	1.148
LMR $+$ LMR#FFF	0.083	0.129	0.202	0.243	0.155	0.405
FFF	–0.041	–0.078	–0.090	–0.191	–0.140	–0.341
Size $_{(t - 1)}$	–2.156	–2.214	–2.126	–3.035	–2.249	–1.644
Growth $_{(t - 1)}$	0.052	0.121	0.042	0.063	0.060	0.207
Leverage $_{(t - 1)}$	–0.125	–0.180	–0.125	–0.137	–0.140	–0.197
NWC $_{(t - 1)}$	–0.006	–0.012	–0.005	–0.007	–0.003	–0.007
Investments $_{(t - 1)}$	–0.031	–0.048	–0.032	–0.051	–0.033	–0.024
Dividends $_{(t - 1)}$	0.021	0.022	0.014	0.015	0.017	–0.002
Cash flow $_{(t - 1)}$	0.003	0.002	0.001	0.004	0.003	0.003
Cash flow volatility $_{(t - 1)}$	0.006	0.014	–0.001	0.005	0.007	0.016
Other ultimate owner	0.002	0.008	0.011	0.014	–0.006	–0.013
Inflation $_{(t - 1)}$	–0.008	0.005	–0.009	–0.009	0.012	0.041
GDP growth $_{(t - 1)}$	–0.003	–0.001	–0.001	–0.003	–0.001	–0.003
ln(GDP p.c.) $_{(t - 1)}$	6.285	2.978	5.175	13.163	0.694	0.761
Firm fixed effects	Yes	Yes	Yes	Yes	Yes	Yes
Industry-Year fixed effects	Yes	Yes	Yes	Yes	Yes	Yes
Country specific year trend	Yes	Yes	Yes	Yes	Yes	Yes
Clustered standard errors	Country-level	Country-level	Country-level	Country-level	Country-level	Country-level
Observations	28,113	28,113	12,098	12,098	7,027	7,027

Note(s):

This table reports the economic significance of FFF-related differential effect of LMR on cash holdings based on regression coefficients from Tables 3 and 4 and summary statistics in Table 1, Panel A, B, and C. Economic significance is assessed in terms of elasticity of cash holdings (y) towards each independent variable (x). Column 1 (2) show the results for Cash (CashToNetAssets) for the whole sample, column 3 (4) for the subsample of labor-intensive firms, and column 5 (6) for the subsample of domestic firms. All variables are defined in Table A1 in the Appendix

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