Economic policy uncertainty and corporate cash holdings: the moderating role of country-level of corruption and uncertainty avoidance

This paper investigates the relationship between economic policy uncertainty and corporate cash holdings using data from seven emerging countries for the 2010–2018 period. Empirical results show that firms tend to hold more cash when EPU is high. Moreover, this positive relationship is stronger in countries with better control of corruption and in high uncertainty avoidance cultures. Results are robust to different measures of cash holdings and EPU.