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Table 1 Variable definition

From: Government control and the value of cash: evidence from listed firms in China

Variable Definition
GOV A dummy variable set to one if the ultimate controller is a government institution, and zero otherwise
GOV1 A dummy variable set to one if a government institution ultimately controls the firm at above 10% control rights, and zero otherwise
GOV2 A dummy variable set to one if a government institution ultimately controls the firm at above 20% control rights, and zero otherwise
GOV_cont Government’s ultimate control rights in government-controlled firms, and zero in privately controlled firms
State ownership The percentage of legally defined state-owned shares
Transfer A dummy variable set to one in year when firm is transferred to private owners and afterwards, and zero in years preceding the transformation
r − RB Excess stock return, where r is the stock return and RB is the corresponding benchmark portfolio return in the same year
CASH Cash and cash equivalents
MVE The market value of equity
EBIT Earnings before interest and taxes
NA Net assets, defined as total assets minus cash and cash equivalents
INT Interest expenses
DIV Cash dividends
MLEV Market leverage, defined as total debts divided by the market value of assets
NF Net financing, defined as the sum of net proceeds from equity and debt issuance
MOWN The percentage of shares owned by managers
INST The percentage of shares owned by domestic mutual funds and QFII
EXCESS The ratio of control rights to cash-flow rights by the ultimate controllers
ANACOV The natural logarithm of one plus the number of analysts following the firm
INCR_INV Increase in investment, defined as a dummy variable set to one if a firm increases investment in the next year, and zero otherwise; Investment is measured by capital expenditure or the sum of capital expenditure and acquisitions
INCR_RD Increase in R&D, defined as a dummy variable set to one if a firm increases research and development expenses in the next year, and zero otherwise
Q Tobin’s q, defined as the market value of equity plus liabilities divided by total assets minus intangible assets and goodwill
SIZE The natural logarithm of total assets adjusted using the CPI deflator
CF Operating cash flow, defined as net cash flow from operating activities
BLEV Book leverage, defined as total debts divided by the book value of total assets
DIV A dummy variable set to one if the firm pays out dividends, and zero otherwise
SG The growth rate of sales
ROA Earnings before interest and taxes divided by total assets
MB Market to book ratio, defined as the market value of equity plus total liabilities divided by the book value of assets
CAPEX Capital expenditures, defined as cash paid to acquire and construct fixed assets, intangible assets and other long-term assets minus the cash received from the disposals of fixed assets, intangible assets and other long-term assets
NWC Net working capital, defined as current assets minus cash and cash equivalents minus current liabilities
STD Short-term debts
GEI Gross equity issued, defined as the amount of proceeds from equity issues
NDI Net debt issued, defined as the amount of cash received from issuing bonds or obtaining bank loans minus repayments
AGE The natural logarithm of one plus the number of years after the initial public offering
MKT The composite NERI index of marketization at the province level
BANK The NERI index of banking liberalization at the province level
GOVT The NERI index of government decentralization in the economy at the province level
FISC The government fiscal condition, measured by local government fiscal revenue divided fiscal expenditure at the province level
NADM The government non-arbitrary revenue, measured by the percentage of local government non-administrative revenue at the province level
EMP The condition of employment, measured by the employment rate at the province level
GRP The natural logarithm of gross regional product at the province level
GRPGTH The growth rate of gross regional product at the province level