Research On Economic Policy Uncertainty And Corporate Preventive Cash Holdings

In October 2017,President Xi Jinping pointed out in the report of the Nineteenth National Congress that deepening supply-side structural reforms and putting the focus of economic development on the real economy have become the focus of China's economic development.Recalling the history of China's economic development,government economic policies have had an unnegligible impact on China's industrial structure and enterprise development,and some scholars have put forward the concept of economic policy uncertainty.As the name implies,economic policy uncertainty is a policy change that regulates the economy Instability to the market.At present,studies have found that economic policy uncertainty not only has a direct impact on securities prices,but also indirectly affects investor behavior and corporate investment and financing.Cash is regarded as the "blood" of business operation and development.In the face of greater economic policy uncertainty,whether companies will adjust cash holdings for preventive motivation has become the focus of this article.Based on the preventive motivation of corporate cash holdings,this paper uses the Chinese Economic Policy Uncertainty Index jointly released by Stanford University and the University of Chicago as a measure of the uncertainty of China's economic policy.It selects 3364 listed companies from 2009 to 2018.Open financial data,choose a fixed-effect panel regression model through the Hausman test to test whether economic policy uncertainty will affect corporate cash holdings,and combine theory to explain the formation mechanism of the impact.In addition,this article discusses the existence of heterogeneity of corporate financing capabilities in combination with literature,and then further discusses the prevention of companies with differences in financing capabilities from the perspective of property rights,political connections,bank-enterprise relations,and financial development.The impact of cash holdings.The study found that economic policy uncertainty is significantly positively correlated with corporate preventive cash holdings.The higher the economic policy uncertainty,the higher the level of corporate preventive cash holdings;further research found that in terms of preventive cash holdings,non-State-owned enterprises are more sensitive to the performance of economic policy uncertainties than state-owned enterprises;the relationship between government-enterprise linkages and bankenterprise relationships can significantly alleviate the impact of increased economic policy uncertainties on corporate cash holdings;in addition,the level of financial development is relatively In higher regions,the impact of economic policy uncertainty on corporate preventive cash holdings is relatively weak.This paper studies the relationship between economic policy uncertainty and corporate cash holdings from the perspective of preventive motivation.New empirical evidence has been added to the field of behavioral research.