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Begin New Search Topic Cash Political Geography Global Focus

1. Determinants of corporate cash holdings in South Africa

Author:
Ewa Karwowski, Hanna Szymborska, Keagile Lesame, and Tlhologelo Thoka
Publication Date:
08-2022
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Globally, corporate cash holdings have risen since the 1980s. In South Africa, some commentators have accused corporations of engaging in an ‘investment strike’, while others see corporate liquidity as a precaution against systemic uncertainty. We use the unique South African Revenue Service/National Treasury firm-level dataset to scrutinize corporate liquidity, using panel analysis. Relative to GDP, corporate cash and liquidity holdings have not increased between 2010 and 2017. However, corporate cash is high in international comparison and has grown at the firm level. We do not find evidence for the hypothesis that companies are engaging in an investment strike. Cash and liquidity are shaped by idiosyncratic and sectoral risk factors. In the short run, heightened uncertainty might reduce corporate cash and liquidity as firms struggle to adjust to an unexpected economic situation. In the medium run, we find a strong association between political uncertainty and corporate cash and liquidity holdings.
Topic:
Economics, Corporations, Liquidity, and Cash
Political Geography:
Africa, South Africa, and Global Focus

2. Financial Freedom and Privacy in the Post‐​Cash World

Author:
Alex Gladstein
Publication Date:
06-2021
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
The future of currency is digital. The majority of transactions made every day are already electronic and controlled by banks or tech companies. These payments are easily surveillable, confiscatable, and censorable. Physical cash still functions as an essential savings mechanism and privacy tool for millions of people worldwide. With cash, individuals can buy goods and services or save without sharing their identity with a third‐​party merchant or custodian. But as banknotes fade from daily use, the future of financial freedom and privacy comes into serious jeopardy.
Topic:
Finance, Privacy, Freedom, Digital Currency, and Cash
Political Geography:
Global Focus

3. The Covid‐​19 Coin Shortage: Causes, Responses, and Lessons

Author:
Nicholas Anthony
Publication Date:
10-2021
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
Covid‐​19 altered almost every facet of the human experience in 2020. For those who were lucky, living rooms became offices, cocktail hours went virtual, and spare time was spent exploring new passions. But others suffered: hundreds of thousands of people died, millions became unemployed, and even more were left uncertain about their future. All the while, smaller inconveniences multiplied. Of these, the most unexpected was a serious coin shortage in the summer of 2020.
Topic:
Currency, COVID-19, Cash, and Shortage
Political Geography:
Global Focus

4. The War on Cash: Institutional Hostility and Covid‐​19

Author:
Edoardo Beretta and Doris Neuberger
Publication Date:
10-2021
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
There is significant economic literature investigating the hostility to cash or “war on cash” (Beretta 2005, 2007; Deutsche Bundesbank 2017; Jain 2017; Scott 2013; White 2018) by which financial institutions supported by governments discourage individuals from using (publicly issued) physical means of payments and convince them to move to digital (privately issued) ones.
Topic:
Economics, COVID-19, Digitization, and Cash
Political Geography:
Global Focus

5. Covid Cash

Author:
Kenneth Rogoff and Jessica Scazzero
Publication Date:
10-2021
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
The advent of the Covid‐​19 pandemic has witnessed a strong uptick in paper currency demand across advanced economies, even as contactless methods surged ahead of cash in payments. This article explores these two contrasting phenomena, which are in fact continuations of much longer‐​term trends. The use of cash, while still important for small in‐​person transactions, has been declining as a share of overall consumer payments for decades, thanks to a steady stream of innovations including credit cards, debit cards, electronic transfers, and smartphone payment apps. For example, in the United States, paper currency accounted for 26 percent of the number of consumer payments in 2019 but only 6 percent in value terms, down from 40 percent and 14 percent, respectively, in 2012. Meanwhile, U.S. dollars in circulation have increased from $1.1 trillion in January 2012 to $1.8 trillion in January 2020, exploding to $2.1 trillion in December 2020. The same pattern remains if one excludes foreign holdings (50–60 percent of the total) and is found in most other advanced economies as well. Some argue that soaring currency demand contests the view that the world is headed to a cashless future, or even a “less‐​cash” society (see Bech et al. 2018; BIS 2020).
Topic:
Currency, COVID-19, Digitization, and Cash
Political Geography:
Global Focus