Three essays on risk management and corporate finance

Authors
Gao, Tianjiao
ORCID
Loading...
Thumbnail Image
Other Contributors
Francis, Bill
Hasan, Iftekhar
Wu, Qiang
Ye, Pengfei
Issue Date
2014-05
Keywords
Management
Degree
PhD
Terms of Use
This electronic version is a licensed copy owned by Rensselaer Polytechnic Institute, Troy, NY. Copyright of original work retained by author.
Full Citation
Abstract
In the third essay, we focus on the topic of managerial ability and its impact on the value of firm through cash holdings. We compare firm value and cash policy of firms with high managerial ability with those with relatively low managerial ability. The finding indicates that superior managers can significantly increase cash value: a dollar of cash is worth 0.289 dollars more for firms with high-ability managers. We also find that high-ability managers tend to spend less cash and accumulate more. High-ability managers are able to reserve the bad firm performance due to cash dissipation, which confirm our hypothesis that managers with high ability tend to make correct investment decisions, maintain low costs and have a more accurate vision of industry and market.
Description
May 2014
School of Management
Department
Lally School of Management
Publisher
Rensselaer Polytechnic Institute, Troy, NY
Relationships
Rensselaer Theses and Dissertations Online Collection
Access
Restricted to current Rensselaer faculty, staff and students. Access inquiries may be directed to the Rensselaer Libraries.