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Cash Holdings in Family Firms: Outlines of an Emerging Debate

  • Cecilia Correggi , Domenico Rocco Cambrea ORCID logo EMAIL logo , Paolo Di Toma and Stefano Ghinoi
Published/Copyright: January 24, 2025

Abstract

The literature on cash holdings has gained increasing relevance within business studies, which highlights its pivotal role in determining a firm’s resource management strategy. In this study, we adopt a combination of bibliometric analysis and systematic literature review to analyse the development of literature on cash holdings and provide an overview of its theoretical and empirical evolution and identify future research paths. After collecting 46 documents from Scopus and Web of Science published from January 2011 to on 7th October 2024, we created and analysed a thematic map based on a co-word analysis to appreciate the form and content of academic discourse on the topic and investigated the content and main contributions of the 46 publications to understand the evolution of the themes discussed in the literature. Results show that family business studies are still anchored to the traditional topics of the research stream of cash holdings, such as corporate governance, and mostly employ agency theory. We found that current family business research and cash holdings only represent a first step in exploring the topic and act as forerunners for the investigation of another research stream – such as innovation/sustainability – or the employment of alternative theories – such as socioemotional wealth. Overall, we provide some insights for future research.


Corresponding author: Domenico Rocco Cambrea, Department of Communication and Economics, University of Modena and Reggio Emilia, Reggio Emilia, Italy, E-mail:

Appendix A

Occurrences Words Cluster Cluster label Btw centrality Clos centrality Page rank centrality
26 Cash holding 1 Cash holding 1,626.207 0.006 0.117
18 Family firm 1 Cash holding 1,283.926 0.006 0.081
12 Corporate governance 1 Cash holding 427,297 0.005 0.05
3 Firm performance 1 Cash holding 38,118 0.005 0.016
3 Liquidity 1 Cash holding 45,967 0.004 0.014
2 Ownership concentration 1 Cash holding 40,737 0.005 0.012
7 Agency theory 2 Agency theory 419,075 0.005 0.032
2 Speed of adjustment 2 Agency theory 24,37 0.004 0.01
6 Family control 3 Family control 751,907 0.005 0.029
5 Board of directors 4 Board of directors 87,127 0.004 0.02
5 Ownership 5 Ownership 450,512 0.005 0.024
2 Dividend policy 5 Ownership 69,902 0.005 0.012
4 Firm value 6 Firm value 26,812 0.003 0.016
3 Cash 7 Cash 453,395 0.004 0.018
2 Agency costs 8 Agency costs 99,516 0.005 0.011
2 Value of cash 8 Agency costs 106,595 0.005 0.01
2 Family succession 9 Family succession 49,833 0.004 0.009
2 Socioemotional wealth (sew) 10 Socioemotional wealth (sew) 51,233 0.004 0.012

Appendix B

Authors Title Year Source
1. Ahmed J.; Tahir M. Corporate cash holdings and financial performance: moderating effect of corporate governance and family ownership 2024 South Asian Journal of Business Studies
2. Akben-Selçuk A.; Sener P. Corporate governance and tunnelling: empirical evidence from Turkey 2018 Economics Bulletin
3. Akben-Selçuk E.; Sener P. Cash holdings and corporate governance: evidence from Turkey 2019 Corporate Governance Models and Applications in Developing Economies
4. Alghadi, M.Y.; Al Nsour, I.R.; Aizyadat, A.A.K. Ownership structure and cash holdings: empirical evidence from Saudi Arabia 2021 Journal of Asian Finance Economics and Business
5. Amoako-Adu B.; Baulkaran V.; Smith B.F. Dual class discount, and the channels of extraction of private benefits 2013 Advances in Financial Economics
6. Amore et al. How do managerial successions shape corporate financial policies in 2011 Journal of Corporate Finance
7. Anderson R.W.; Hamadi M. Cash holding and control-oriented finance 2016 Journal of Corporate Finance
8. Attig N.; El Ghoul S.; Guedhami O.; Rizeanu S. The governance role of multiple large shareholders: evidence from the valuation of cash holdings 2013 Journal of Management and Governance
9. Belenzon S.; Patacconi A.; Zarutskie R. Married to the firm? A large-scale investigation of the social context of ownership 2016 Strategic Management Journal
10. Boubaker S.; Derouiche I.; Hassen M. Family control and the value of cash holdings 2015 Journal of Applied Business Research
11. Brahmana R.K.; Setiawan D.; Kontesa M.; Soo L.-U. Cash holdings and R&D intensity with different controlling shareholders 2023 Journal of Indonesian Economy and Business
12. Del Carmen Briano-Turrent G.; Watkins-Fassler K.; Puente-Esparza M.L. The effect of the board composition on dividends: the case of Brazilian and Chilean family firms 2020 European Journal of Family Business
13. Brogi M.; Gallucci C.; Santulli R. Does one size fit all? A configurational approach to board effectiveness in limiting the excess cash 2021 Management Decision
14. Cambrea D.R.; Ponomareva Y.; Pittino D.; Minichilli A. Strings attached: socioemotional wealth mixed gambles in the cash management choices of family firms 2022 Journal of Family Business Strategy
15. Caprio L.; Del Giudice A.; Signori A. Cash holdings in family firms: CEO identity and implications for firm value 2020 European Financial Management
16. Durán R.F.; Lozano M.B.; Yaman S. Is family control relevant for corporate cash holding policy? 2016 Journal of Business Finance and Accounting
17. Fleitas-Castillo, G.D.; Pérez-Alemán, J.; Santana-Martín, D.J. Board gender diversity and cash holding: the effect of family ties 2024 Review of Managerial Science
18. Guizani A.; Lakhal F.; Lakhal N. The cash flow sensitivity of cash in family firms: does the board of directors matter? 2018 Managerial Finance
19. Gul R.; Ullah S.; Rehman A.U.; Hussain S.; Alam M. Corporate governance and cash holdings: family versus non-family controlled firms 2020 Cogent Business and Management
20. Herdhayinta H.; Lau J.; Shen C.H.-H. Cash holdings of minority family businesses in Indonesia 2023 Emerging Markets Review
21. Hsu A.W.; Liu S.H. Parent-subsidiary investment layers and the value of corporate cash holdings 2018 Review of Quantitative Finance and Accounting
22. Ilyas M.; Mian R.U.; Safdar N. Institutional investors and the value of excess cash holdings: empirical evidence from Pakistan 2022 Managerial Finance
23. Kuan T.-H.; Li C.-S.; Chu S.-H. Cash holdings and corporate governance in family-controlled firms 2011 Journal of Business Research
24. Kuan T.-H.; Li C.-S.; Liu C.-C. Corporate governance and cash holdings: a quantile regression approach 2012 International Review of Economics and Finance
25. Kusnadi Y. Do corporate governance mechanisms matter for cash holdings and firm value? 2011 Pacific Basin Finance Journal
26. Liu Q.; Luo T.; Tian G.G. Family control and corporate cash holdings: Evidence from China 2015 Journal of Corporate Finance
27. Liu Y. Founding family ownership and cash holdings 2011 Journal of Financial Research
28. Lozano M.B. Strategic decisions of family firms on cash accumulation 2015 RAE Revista de Administracao de Empresas
29. Lozano M.B.; Durán R.F. Family control and adjustment to the optimal level of cash holding 2017 European Journal of Finance
30. Lozano M.B.; Yaman S. The determinants of cash flow sensitivity of cash: the family ownership effect 2020 Research in International Business and Finance
31. Mengyun W.; Um-E-Habiba; Husnain M.; Sarwar B.; Ali W. Board financial expertise and corporate cash holdings: moderating role of multiple large shareholders in emerging family firms 2021 Complexity
32. Mohd K.N.T.; Latif R.A.; Saleh I.H. The influence of ownership patterns and board characteristics on firm cash holdings 2017 International Journal of Economic Research
33. Moin A.; Guney Y.; El Kalak I. The effects of ownership structure, sub-optimal cash holdings and investment inefficiency on dividend policy: evidence from Indonesia 2020 Review of Quantitative Finance and Accounting
34. Moolchandani R.; Kar S. Family control, agency conflicts, corporate cash holdings and firm value 2022 International Journal of Emerging Markets
35. Mouline B.; Sadok H. Determinants of corporate cash holdings: evidence from the Moroccan market 2021 Accounting
36. Parrado-Martínez P.; Comino-Jurado M.; Sánchez-Andújar S. Cash holdings decision-making in Spanish family firms: exploring the impact of heterogeneity 2024 Managerial and Decision Economics
37. Portal M.T.; Basso L.F.C. The effect of family control and management on performance, capital structure, cash holding, and cash dividends 2015 Corporate Ownership and Control
38. Ra Y. Why companies have low debt? An empirical evidence in Korea 2024 Heliyon
39. Rouyer E. Family ownership and busy boards: impact on performance 2016 Management Decision
40. Steijvers T.; Niskanen M. The determinants of cash holdings in private family firms 2013 Accounting and Finance
41. Tsay M.-H.; Weng P.-S.; Wang T.-L.; Zhang H. Does the gender composition of the board affect corporate performance and decisions? Evidence from Family Firms and Conglomerates 2020 Journal of Management and Business Research
42. Tsoutsoura M. The effect of succession taxes on family firm investment: evidence from a natural experiment 2015 Journal of Finance
43. Wasiuzzaman S. Analysis of corporate cash holdings of firms in Malaysia 2014 Journal of Asia Business Studies
44. Wu Y.; Chang Q. Large state-owned shareholders and cash holding: evidence from family firms 2024 Pacific Basin Finance Journal
45. Yun J.; Ahmad H.; Jebran K.; Muhammad S. Cash holdings and firm performance relationship: do firm-specific factors matter? 2021 Economic Research-Ekonomska Istrazivanja
46. Zheng X.; Zhu B.; Yang G. The soft landing: does intrafamily succession matter for corporate risk-taking? 2023 Pacific Basin Finance Journal

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Received: 2024-05-18
Accepted: 2024-12-14
Published Online: 2025-01-24

© 2024 Walter de Gruyter GmbH, Berlin/Boston

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