Variable | Variable name | Variable symbols | Variable definition or calculation method |
Dependent variable | Cash holdings | CASH1 | (Cash + cash equivalents)/total assets, with reference to Opler et al. (1999) |
CASH2 | (Cash + cash equivalents)/net assets, net assets = total assets − (cash + cash equivalents), referring to Haushalter et al. (2007) | ||
Explanatory variable | Equity concentration | ONESHARE | The shareholding ratio of the first largest shareholder, whose square item is recorded as ONESHARESQ |
Shares held by other major shareholders | OTHERSHARE | Sum of shareholding ratio of the second to tenth largest shareholders | |
Management shareholding | MSHARE | The shareholding ratio of the managers, including the directors, supervisors and senior management of the company, whose square item is recorded as MSHARESQ | |
Proportion of state-owned shares | GSHARE | Proportion of state-owned shares | |
Board size | BSIZE | Total number of board members (excluding honorary directors) | |
Proportion of independent directors | IND | Number of independent directors/total number of directors | |
Two jobs in one | DUAL | Dummy variable, the chairman and general manager of the two positions in one, take 1; otherwise, take 0 | |
Quality of internal control information disclosure | ICDI | Internal control information disclosure quality index, based on entropy model measurement | |
Control variable | Company size | LNSIZE | Logarithm of total assets |
Debt structure | DMS | Total current liabilities/total liabilities | |
Asset liability ratio | LEV | Total debt/total assets | |
Bank debt ratio | BANKDEBT | (Long term loan + short term loan)/total liabilities | |
Net working capital ratio | NWC | (Current assets − cash equivalents − current liabilities)/total assets | |
Dividend policy | DIV | Dummy variable, when the company pays cash dividends, take 1; otherwise, take 0 | |
Investment opportunity | MB | Market value of the company/book value of the company’s assets | |
Nature of property rights | STATE | Dummy variable, 1 for state-owned enterprises and 0 for non-state-owned enterprises |