On the Determinants of SME Cash Holdings: Evidence from Spain
This work analyses the factors that might explain the level of cash holdings in a sample of 860 small and medium-sized firms from Spain during the period 1996-2001. The empirical results show that firms have a target cash level to which they attempt to converge. The level of this target is higher for firms with more growth opportunities and larger cash flows. In contrast, the target level for cash holdings falls when the use of bank debt and the presence of substitutes for cash increase. Moreover, when the interest rates in the economy increase firms reduce their cash holding. Copyright 2007 The Authors Journal compilation (c) 2007 Blackwell Publishing Ltd.
Year of publication: |
2008-01
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Authors: | García-Teruel, Pedro J. ; Martínez-Solano, Pedro |
Published in: |
Journal of Business Finance & Accounting. - Wiley Blackwell, ISSN 0306-686X. - Vol. 35.2008-01, 1-2, p. 127-149
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Publisher: |
Wiley Blackwell |
Saved in:
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