search query: @author Hadlock, C. / total: 1
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| Author: | Hadlock, C. |
| Title: | Ownership, liquidity, and investment |
| Journal: | RAND Journal of Economics
1998 : AUTUMN, VOL. 29:3, p. 487-508 |
| Index terms: | LIQUIDITY INVESTMENT ECONOMICS |
| Language: | eng |
| Abstract: | This article documents a nonlinear relationship between insider shareholding and the sensitivity of a firm's investment to its cash flow. As insider holdings increase from zero, investment-cash flow sensitivities rise sharply. This relationship weakens at higher levels of insider ownership, and the author finds some evidence that investment-cash flow sensitivities decrease slowly with insider holdings after a certain point. The author argues that these results are inconsistent with the hypothesis that free-cash-flow problems cause the widely noted sensitivity of investment to cash flow. |
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