Cash Holdings and Labor Heterogeneity: The Role of Skilled LaborCitation formats

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Cash Holdings and Labor Heterogeneity: The Role of Skilled Labor. / Ghaly, Mohamed; Dang, Viet Anh; Stathopoulos, Konstantinos.

In: Review of Financial Studies, Vol. 30, No. 10, 10.2017, p. 3636-3668.

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Ghaly, Mohamed ; Dang, Viet Anh ; Stathopoulos, Konstantinos. / Cash Holdings and Labor Heterogeneity: The Role of Skilled Labor. In: Review of Financial Studies. 2017 ; Vol. 30, No. 10. pp. 3636-3668.

Bibtex

@article{ddd146f6d853429c9601d49b6601fee0,
title = "Cash Holdings and Labor Heterogeneity: The Role of Skilled Labor",
abstract = "Firms differ in their dependence on skilled labor, and face labor adjustment costs that increase with their workers{\textquoteright} skill level. We show that firms with a higher share of skilled workers, and thus less flexibility to adjust their labor demand in response to cash flow shocks, hold more precautionary cash. The effect of labor skills on cash holdings is more pronounced for financially constrained firms and varies with exogenous differences in firing and hiring costs. We address endogeneity concerns by using subsamples of firms with reasonably similar characteristics, propensity score matching, and a quasi-experimental shock to labor markets.",
keywords = "Cash Holdings, Skilled Labor, Labor Adjustment Costs, Labor Heterogeneity",
author = "Mohamed Ghaly and Dang, {Viet Anh} and Konstantinos Stathopoulos",
year = "2017",
month = oct,
doi = "10.1093/rfs/hhx045",
language = "English",
volume = "30",
pages = "3636--3668",
journal = "Review of Financial Studies",
issn = "0893-9454",
publisher = "Oxford University Press",
number = "10",

}

RIS

TY - JOUR

T1 - Cash Holdings and Labor Heterogeneity: The Role of Skilled Labor

AU - Ghaly, Mohamed

AU - Dang, Viet Anh

AU - Stathopoulos, Konstantinos

PY - 2017/10

Y1 - 2017/10

N2 - Firms differ in their dependence on skilled labor, and face labor adjustment costs that increase with their workers’ skill level. We show that firms with a higher share of skilled workers, and thus less flexibility to adjust their labor demand in response to cash flow shocks, hold more precautionary cash. The effect of labor skills on cash holdings is more pronounced for financially constrained firms and varies with exogenous differences in firing and hiring costs. We address endogeneity concerns by using subsamples of firms with reasonably similar characteristics, propensity score matching, and a quasi-experimental shock to labor markets.

AB - Firms differ in their dependence on skilled labor, and face labor adjustment costs that increase with their workers’ skill level. We show that firms with a higher share of skilled workers, and thus less flexibility to adjust their labor demand in response to cash flow shocks, hold more precautionary cash. The effect of labor skills on cash holdings is more pronounced for financially constrained firms and varies with exogenous differences in firing and hiring costs. We address endogeneity concerns by using subsamples of firms with reasonably similar characteristics, propensity score matching, and a quasi-experimental shock to labor markets.

KW - Cash Holdings, Skilled Labor, Labor Adjustment Costs, Labor Heterogeneity

U2 - 10.1093/rfs/hhx045

DO - 10.1093/rfs/hhx045

M3 - Article

VL - 30

SP - 3636

EP - 3668

JO - Review of Financial Studies

JF - Review of Financial Studies

SN - 0893-9454

IS - 10

ER -