Files and links (2)
Author’s VersionCC BY-NC-ND V4.0, Open Access
Journal article
Languages and corporate savings behavior
Journal of Corporate Finance, Vol.46, pp.320-341
2017
Abstract
Speakers of strong future time reference (FTR) languages (e.g., English) are required to grammatically distinguish between future and present events, while speakers of weak-FTR languages (e.g., Chinese) are not. We hypothesize that speaking about the future in the present tense may result in the belief that adverse credit events are more imminent. Consistent with such a linguistic hypothesis, weak-FTR language firms are found to have higher precautionary cash holdings. We report additional supportive results from changes in the relative importance of different languages in a country's business domain, evidence from within one country with several distinct languages, and results related to changes following a severe financial crisis. Our evidence introduces a new explanation for heterogeneity in corporate savings behavior, provides insights about belief formation in firms, and adds to research on the effects of languages on economic outcomes.
Details
- Title
- Languages and corporate savings behavior
- Authors/Creators
- S. Chen (Author/Creator) - China Europe International Business SchoolH. Cronqvist (Author/Creator) - University of MiamiS. Ni (Author/Creator) - Sydney Institute of Language and CommerceF. Zhang (Author/Creator) - Murdoch University
- Publication Details
- Journal of Corporate Finance, Vol.46, pp.320-341
- Publisher
- Elsevier B.V.
- Identifiers
- 991005544216707891
- Copyright
- © 2017 Published by Elsevier B.V.
- Murdoch Affiliation
- School of Business and Governance
- Language
- English
- Resource Type
- Journal article
Metrics
605 File views/ downloads
115 Record Views
InCites Highlights
These are selected metrics from InCites Benchmarking & Analytics tool, related to this output
- Collaboration types
- Domestic collaboration
- International collaboration
- Citation topics
- 6 Social Sciences
- 6.10 Economics
- 6.10.63 Corporate Governance
- Web Of Science research areas
- Business, Finance
- ESI research areas
- Economics & Business