Table 10. Alternative explanations II:...

Table 10.

Alternative explanations II: Ownership-related characteristics

Dependent variable		Cash
Sample		Full	w/o widely held firms
Specification	Coeff.	(1)	(2)	(3)
LMR	$λ_{1}$	–0.001 (−0.58)	–0.006* (−1.93)	–0.005 (−1.63)
LMR#FFF	$λ_{2}$	0.005** (2.19)	0.011*** (4.28)	0.010*** (4.23)
FFF		–0.020*** (−3.25)	–0.042** (−2.26)	–0.063 (−0.24)
LMR# other ultimate owner	$λ_{3}$	–0.005*** (−3.29)
Other ultimate owner		0.020*** (2.98)
Diff	H₀: $λ_{1} = λ_{1} + λ_{2}$	$p < 0.028$
Diff	H₀: $λ_{2} = λ_{3}$	$p < 0.000$
Diff	H₀: $λ_{1} + λ_{2} = λ_{1} + λ_{3}$	$p < 0.000$
Size $_{(t - 1)}$ #FFF				0.007 (1.64)
Growth $_{(t - 1)}$ #FFF				–0.004 (−0.93)
Leverage $_{(t - 1)}$ #FFF				–0.016 (−0.77)
NWC $_{(t - 1)}$ #FFF				–0.001 (−0.03)
Investments $_{(t - 1)}$ #FFF				–0.022 (−1.05)
Dividend dummy $_{(t - 1)}$ #FFF				–0.003 (−0.75)
Cash flow $_{(t - 1)}$ #FFF				0.014 (0.71)
Cash flow volatility $_{(t - 1)}$ #FFF				0.046* (1.97)
Inflation $_{(t - 1)}$ #FFF				–0.103 (−0.81)
GDP growth $_{(t - 1)}$ #FFF				0.017 (0.39)
ln(GDP p.c.) $_{(t - 1)}$ #FFF				–0.004 (−0.17)
Controls		Yes	Yes	Yes
Firm fixed effects		Yes	Yes	Yes
Industry-Year fixed effects		Yes	Yes	Yes
Country specific year trend		Yes	Yes	Yes
Clustered standard errors		Country-level	Country-level	Country-level
Observations		28,113	15,185	15,185
$R_{a d j}^{2}$		0.058	0.065	0.067

Dependent variable		Cash
Sample		Full	w/o widely held firms
Specification	Coeff.	(1)	(2)	(3)
LMR	$λ_{1}$	–0.001 (−0.58)	–0.006* (−1.93)	–0.005 (−1.63)
LMR#FFF	$λ_{2}$	0.005** (2.19)	0.011*** (4.28)	0.010*** (4.23)
FFF		–0.020*** (−3.25)	–0.042** (−2.26)	–0.063 (−0.24)
LMR# other ultimate owner	$λ_{3}$	–0.005*** (−3.29)
Other ultimate owner		0.020*** (2.98)
Diff	H₀: $λ_{1} = λ_{1} + λ_{2}$	$p < 0.028$
Diff	H₀: $λ_{2} = λ_{3}$	$p < 0.000$
Diff	H₀: $λ_{1} + λ_{2} = λ_{1} + λ_{3}$	$p < 0.000$
Size $_{(t - 1)}$ #FFF				0.007 (1.64)
Growth $_{(t - 1)}$ #FFF				–0.004 (−0.93)
Leverage $_{(t - 1)}$ #FFF				–0.016 (−0.77)
NWC $_{(t - 1)}$ #FFF				–0.001 (−0.03)
Investments $_{(t - 1)}$ #FFF				–0.022 (−1.05)
Dividend dummy $_{(t - 1)}$ #FFF				–0.003 (−0.75)
Cash flow $_{(t - 1)}$ #FFF				0.014 (0.71)
Cash flow volatility $_{(t - 1)}$ #FFF				0.046* (1.97)
Inflation $_{(t - 1)}$ #FFF				–0.103 (−0.81)
GDP growth $_{(t - 1)}$ #FFF				0.017 (0.39)
ln(GDP p.c.) $_{(t - 1)}$ #FFF				–0.004 (−0.17)
Controls		Yes	Yes	Yes
Firm fixed effects		Yes	Yes	Yes
Industry-Year fixed effects		Yes	Yes	Yes
Country specific year trend		Yes	Yes	Yes
Clustered standard errors		Country-level	Country-level	Country-level
Observations		28,113	15,185	15,185
$R_{a d j}^{2}$		0.058	0.065	0.067

Note(s):

This table presents the results of OLS regressions accounting for alternative ownership-related characteristics, explaining the main findings. Column 1 presents the results of OLS regression of FFF-related and other ultimate owner-related differential effect of LMR on cash holdings using widely held firms as reference group. Columns 2 and 3 show the FFF-related differential effect using other ultimate owner as reference group. The table also reports results of Wald-test for coefficients from Column 1. In all regression specifications, Cash is used as dependent variable. All variables are defined in Table A1 in the Appendix. All independent variables except LMR and all ownership-related variables are lagged by one period. All regression specifications include firm fixed effects, industry-year fixed effects, and country specific year trends. The t-Statistics in parentheses are based on robust standard errors, clustered at the country level. *, **, *** denote statistical significance at the 10, 5, and 1% levels, respectively

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