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Table 6 Disgorging cash via investment and investment efficiency

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

Variable Increase in Investment Increase in R&D Investment
(1) (2) (3) (4) (5)
GOV − 0.054
(− 1.10)
− 0.037
(− 0.75)
− 0.136
(− 1.37)
− 0.004*
(− 1.90)
− 0.005**
(− 2.07)
CASH 0.809***
(5.19)
0.985***
(6.16)
1.224***
(4.52)
  
CASH × GOV 0.629***
(2.73)
0.584**
(2.48)
− 0.883**
(− 2.10)
  
Q × GOV     − 0.002***
(− 2.59)
− 0.003***
(− 3.75)
Q 0.017
(1.29)
0.011
(0.87)
0.032
(1.50)
0.003***
(5.53)
0.005***
(8.06)
SIZE 0.004
(0.23)
− 0.003
(− 0.15)
0.022
(0.64)
0.001
(1.54)
0.002**
(2.26)
CF 0.077
(0.34)
− 0.202
(− 0.90)
− 0.560
(− 1.52)
0.101***
(14.48)
0.102***
(13.85)
BLEV − 0.398***
(− 3.57)
− 0.441***
(− 3.94)
− 0.138
(− 0.62)
0.063***
(13.11)
0.065***
(13.21)
DIV − 0.077**
(− 2.13)
− 0.077**
(− 2.12)
0.510***
(8.08)
0.017***
(14.57)
0.018***
(14.84)
SG 0.146***
(2.67)
0.076
(1.37)
0.454***
(5.65)
0.008***
(6.04)
0.0014***
(9.08)
ROA 2.747***
(7.87)
2.904***
(8.26)
3.014***
(5.15)
0.040***
(3.88)
0.035***
(3.23)
Constant − 0.305
(− 0.85)
− 0.146
(− 0.40)
− 3.693***
(− 5.03)
0.012
(0.76)
− 0.005
(− 0.32)
Year effects Yes Yes Yes Yes Yes
Industry effects Yes Yes Yes Yes Yes
Pseudo R-squared 0.02 0.02 0.28 0.16 0.16
Observations 16,682 16,682 12,532 19,321 19,321
  1. The table reports the results of disgorging cash via investment, R&D, and investment efficiency where Investment is measured as capital expenditure in columns 1 and 4, the sum of capital expenditure and acquisitions in columns 2 and 5. The dependent variable is the increase in investment (INCR_INV) in columns 1 and 2, the increase in R&D (INCR_RD) in column 3 and investment in columns 4 and 5. CASH and CF are deflated by total assets. The definitions of all variables are shown in Table 1. For all regressions, t-statistics (in parentheses) are based on robust standard errors clustered at the firm level
  2. ***, ** and * denote significance at the 1%, 5%, and 10% levels, respectively