Table 6 Relationship between ownership...

Table 6

Relationship between ownership and cash holding – deficit vs surplus firms

	CASH1				CASH2
	POLS			GMM	POLS			GMM
	Deficit	Surplus	All firms	All firms	Deficit	Surplus	All firms	All firms
	(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)
L.CASH1				0.6927***
L.CASH1				[0.0332]
L.CASH2								0.5764***
L.CASH2								[0.0407]
FO	0.1502***	0.0690***	0.0731***	0.0059	0.1988***	0.0778***	0.0810***	0.0178*
FO	[0.0487]	[0.0200]	[0.0199]	[0.0081]	[0.0597]	[0.0195]	[0.0193]	[0.0093]
SO	0.0776***	0.0204*	0.0222**	0.0076*	0.0905***	0.0222**	0.0237**	0.0072
SO	[0.0166]	[0.0111]	[0.0111]	[0.0042]	[0.0213]	[0.0108]	[0.0108]	[0.0058]
deficit_dum			−0.0271***	−0.0100***			−0.0379***	−0.0136***
deficit_dum			[0.0054]	[0.0032]			[0.0064]	[0.0043]
FO*deficit_dum			0.0842*	0.0394*			0.1252**	0.0488*
FO*deficit_dum			[0.0464]	[0.0314]			[0.0541]	[0.0304]
SO*deficit_dum			0.0455***	0.0207*			0.0598***	0.0364**
SO*deficit_dum			[0.0163]	[0.0120]			[0.0183]	[0.0156]
SIZE	−0.0074*	−0.0002	−0.0012	0.0012***	−0.0088**	−0.0025	−0.0034*	0.0024***
SIZE	[0.0038]	[0.0021]	[0.0020]	[0.0002]	[0.0043]	[0.0019]	[0.0019]	[0.0003]
GROWTH	0.0119	−0.0224***	−0.0194***	−0.0072***	−0.0332***	−0.0699***	−0.0672***	−0.0406***
GROWTH	[0.0115]	[0.0061]	[0.0058]	[0.0024]	[0.0104]	[0.0047]	[0.0045]	[0.0035]
PROFIT	0.0081	0.2337***	0.2178***	0.1034***	0.0098	0.1475***	0.1345***	0.1347***
PROFIT	[0.0593]	[0.0344]	[0.0336]	[0.0163]	[0.0717]	[0.0289]	[0.0277]	[0.0170]
TDA	−0.0895***	−0.1817***	−0.1738***	−0.0617***	−0.1082***	−0.1701***	−0.1639***	−0.0751***
TDA	[0.0238]	[0.0168]	[0.0159]	[0.0084]	[0.0268]	[0.0154]	[0.0148]	[0.0109]
Constant	0.2519**	0.1559***	0.1768***		0.3209***	0.2516***	0.2710***
Constant	[0.1014]	[0.0550]	[0.0533]		[0.1149]	[0.0511]	[0.0504]
N	548	6,232	6,780	6,780	548	6,232	6,780	6,211
R²	0.2475	0.2176	0.2236		0.2718	0.2672	0.2672
AR²				0.2313				0.5363
Hansen				0.0610				0.1231

	CASH1				CASH2
	POLS			GMM	POLS			GMM
	Deficit	Surplus	All firms	All firms	Deficit	Surplus	All firms	All firms
	(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)
L.CASH1				0.6927***
L.CASH1				[0.0332]
L.CASH2								0.5764***
L.CASH2								[0.0407]
FO	0.1502***	0.0690***	0.0731***	0.0059	0.1988***	0.0778***	0.0810***	0.0178*
FO	[0.0487]	[0.0200]	[0.0199]	[0.0081]	[0.0597]	[0.0195]	[0.0193]	[0.0093]
SO	0.0776***	0.0204*	0.0222**	0.0076*	0.0905***	0.0222**	0.0237**	0.0072
SO	[0.0166]	[0.0111]	[0.0111]	[0.0042]	[0.0213]	[0.0108]	[0.0108]	[0.0058]
deficit_dum			−0.0271***	−0.0100***			−0.0379***	−0.0136***
deficit_dum			[0.0054]	[0.0032]			[0.0064]	[0.0043]
FO*deficit_dum			0.0842*	0.0394*			0.1252**	0.0488*
FO*deficit_dum			[0.0464]	[0.0314]			[0.0541]	[0.0304]
SO*deficit_dum			0.0455***	0.0207*			0.0598***	0.0364**
SO*deficit_dum			[0.0163]	[0.0120]			[0.0183]	[0.0156]
SIZE	−0.0074*	−0.0002	−0.0012	0.0012***	−0.0088**	−0.0025	−0.0034*	0.0024***
SIZE	[0.0038]	[0.0021]	[0.0020]	[0.0002]	[0.0043]	[0.0019]	[0.0019]	[0.0003]
GROWTH	0.0119	−0.0224***	−0.0194***	−0.0072***	−0.0332***	−0.0699***	−0.0672***	−0.0406***
GROWTH	[0.0115]	[0.0061]	[0.0058]	[0.0024]	[0.0104]	[0.0047]	[0.0045]	[0.0035]
PROFIT	0.0081	0.2337***	0.2178***	0.1034***	0.0098	0.1475***	0.1345***	0.1347***
PROFIT	[0.0593]	[0.0344]	[0.0336]	[0.0163]	[0.0717]	[0.0289]	[0.0277]	[0.0170]
TDA	−0.0895***	−0.1817***	−0.1738***	−0.0617***	−0.1082***	−0.1701***	−0.1639***	−0.0751***
TDA	[0.0238]	[0.0168]	[0.0159]	[0.0084]	[0.0268]	[0.0154]	[0.0148]	[0.0109]
Constant	0.2519**	0.1559***	0.1768***		0.3209***	0.2516***	0.2710***
Constant	[0.1014]	[0.0550]	[0.0533]		[0.1149]	[0.0511]	[0.0504]
N	548	6,232	6,780	6,780	548	6,232	6,780	6,211
R²	0.2475	0.2176	0.2236		0.2718	0.2672	0.2672
AR²				0.2313				0.5363
Hansen				0.0610				0.1231

Note(s): The table presents the results of Equation (1) for two groups: deficit and surplus firms, and results with dummy variables for all firms. Standard errors are in parentheses. The superscripts *, ** and *** indicate significance at the 5, 1 and 0.1% levels, respectively

Source(s): Authors' own calculation

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