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| Tekijä: | Frésard, L. Salva, C. |
| Otsikko: | The value of excess cash and corporate governance: evidence from US cross-listings |
| Lehti: | Journal of Financial Economics
2010 : NOV, VOL. 98:2 p. 359-384 |
| Asiasana: | USA risk finance legislation valuation investors |
| Kieli: | eng |
| Tiivistelmä: | This paper explores whether and how a U.S. cross-listing mitigates the risk that insiders will turn their firms cash holdings into private benefits. Strong evidence is found that the value investors attach to excess cash reserves is substantially larger for foreign firms listed on U.S. exchanges and over the counter than for their domestic peers. Further, it is shown that this excess-cash premium stems not only from the strength of U.S. legal rules and disclosure requirements, but also from the greater informal monitoring pressure that accompanies a U.S. listing. The analysis reveals that a U.S. listing constrains insiders inefficient allocation of corporate cash reserves significantly. |
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