Purpose

This paper aims to document the impact of corporate cash holdings on firm performance in Middle East and North African (MENA) emerging markets. The authors also examine how the quality of national governance shapes the interaction between corporate cash holdings and firm performance.

Design/methodology/approach

The authors employ data from non-financial firms listed on the stock markets of twelve MENA countries between 2004 and 2018. The empirical model avoids the shortcomings of the prior literature by applying a dynamic framework to the relationship between cash holdings and firm performance.

Findings

This research reports a significant positive relationship between corporate cash holdings and firm performance. The results appear to be more pronounced in countries with strong national governance and more developed institutional settings. The findings demonstrate that most benefits of corporate cash holdings can be achieved under strong institutional settings. The authors argue that the positive impact that national governance has on individual firms by reinforcing investors' protection and lowering agency problems increases the added value of cash holdings.

Practical implications

The findings should encourage local authorities and policymakers to reinforce the law and instigate new regulations to strengthen the quality of national governance and restore the integrity of local markets.

Originality/value

Prior studies have largely been silent on how national governance can shape the relationship between corporate cash holdings and firm performance. This paper draws attention to this issue within the context of MENA emerging markets. To the authors' best knowledge, this is the first study that explores the interaction between cash holdings, firm performance and national governance in MENA emerging markets.

中文翻译：

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公司现金持有量、公司业绩和国家治理：来自新兴市场的证据

目的

本文旨在记录公司现金持有量对中东和北非 (MENA) 新兴市场公司业绩的影响。作者还研究了国家治理的质量如何影响公司现金持有和公司业绩之间的相互作用。

设计/方法/方法

作者采用了 2004 年至 2018 年间在 12 个 MENA 国家股票市场上市的非金融公司的数据。该实证模型通过将动态框架应用于现金持有量与公司绩效之间的关系，避免了先前文献的缺点。

发现

该研究报告了公司现金持有量与公司业绩之间存在显着的正相关关系。在拥有强大国家治理和更发达制度环境的国家，结果似乎更为明显。调查结果表明，企业持有现金的大部分收益都可以在强大的制度环境下实现。作者认为，国家治理通过加强投资者保护和减少代理问题对个别公司产生的积极影响增加了现金持有的附加值。

实际影响

调查结果应鼓励地方当局和政策制定者加强法律并制定新的法规，以加强国家治理的质量并恢复当地市场的完整性。

原创性/价值

先前的研究在很大程度上对国家治理如何影响公司现金持有量与公司业绩之间的关系保持沉默。本文在 MENA 新兴市场的背景下提请注意这个问题。据作者所知，这是第一项探讨中东和北非新兴市场现金持有、公司业绩和国家治理之间相互作用的研究。