Inflation and the evolution of firm-level liquid assets

Autor:	Chadwick C. Curtis, M. Saif Mehkari, Julio Garin
Rok vydání:	2017
Předmět:	Inflation Economics and Econometrics 050208 finance media_common.quotation_subject 05 social sciences Monetary economics A share Current asset Market liquidity Cash 0502 economics and business Value (economics) Economics Portfolio Asset (economics) 050207 economics Finance media_common
Zdroj:	Journal of Banking & Finance. 81:24-35
ISSN:	0378-4266
Popis:	This paper shows that inflation has been an important determinant of firm-level liquid asset holdings. Liquid assets as a share of total assets – the cash ratio – for U.S. corporations steadily declined from the 1960s to the early 1980s, and has since steadily increased. Our empirical analysis finds that inflation is a key factor accounting for these changes. We show that these liquid asset holdings are imperfectly hedged against inflation. Hence, changes in inflation alter the real value of a firm’s liquid asset portfolio causing them to readjust these balances.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::e4ba4466b56814a94ba77040e0170b9f https://doi.org/10.1016/j.jbankfin.2017.04.008 Zobrazit plný text záznamu Full Text from ScienceDirect