The Essence of CEO Inside Debt
DOI:
https://doi.org/10.58886/jfi.v22i2.8305Keywords:
CEO Inside Debt, corporate cash, firm valueAbstract
I examine the effect of CEO pension and deferred compensation, commonly known as CEO inside debt, on corporate cash holdings, as measured by the ratio of cash and marketable securities to net assets. Utilizing a sample of EXECUCOMP firms over the period of 2006 to 2008, I find a positive relation between the corporate cash holdings and CEO inside debt. I also find that cash increases have a more positive valuation effect for firms with high levels of CEO inside debt relative to those with low levels of CEO inside debt.
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