TY - JOUR
T1 - Determinants of corporate cash holdings in times of crisis
T2 - insights from Brazilian sugarcane industry private firms
AU - Manoel, Aviner Augusto Silva
AU - Moraes, Marcelo Botelho da Costa
AU - Santos, David Ferreira Lopes
AU - Neves, Marcos Fava
N1 - Publisher Copyright:
© 2017 Manoel et al.
PY - 2018
Y1 - 2018
N2 - The decision-making process regarding cash allocation, especially in times of recession, is somewhat challenging. Thus, the aim of this study is to evaluate the effects of the financial crisis in cash holdings of privately-held firms in the Brazilian sugarcane industry. For this purpose, a unique, hand-collected panel data of 31 firms for the period from 1998 to 2015 was used. The results show that the private firms of the industry maintain higher levels of cash than the average found by studies with Brazilian public companies. Furthermore, between the two dummy variables used, representing the subprime crisis and the most recent economic crisis in Brazil, only the second one was significant. Finally, in order to overcome the adverse conditions of the current Brazilian economic crisis, it was observed an increase in cash holdings, which, in turn, denotes the relevance of precautionary reasons in the understanding of cash management.
AB - The decision-making process regarding cash allocation, especially in times of recession, is somewhat challenging. Thus, the aim of this study is to evaluate the effects of the financial crisis in cash holdings of privately-held firms in the Brazilian sugarcane industry. For this purpose, a unique, hand-collected panel data of 31 firms for the period from 1998 to 2015 was used. The results show that the private firms of the industry maintain higher levels of cash than the average found by studies with Brazilian public companies. Furthermore, between the two dummy variables used, representing the subprime crisis and the most recent economic crisis in Brazil, only the second one was significant. Finally, in order to overcome the adverse conditions of the current Brazilian economic crisis, it was observed an increase in cash holdings, which, in turn, denotes the relevance of precautionary reasons in the understanding of cash management.
KW - Agribusiness
KW - Agri-food
KW - Cash management
KW - Treasury
KW - Financial crisis
UR - http://www.scopus.com/inward/record.url?scp=85044265929&partnerID=8YFLogxK
U2 - 10.22434/IFAMR2017.0062
DO - 10.22434/IFAMR2017.0062
M3 - Article
SN - 1096-7508
VL - 21
SP - 201
EP - 218
JO - International Food and Agribusiness Management Review
JF - International Food and Agribusiness Management Review
IS - 2
ER -
