Corporate Cash Holdings and Economic Crises in Mexico
Trejo-Pech, C., M. Noguera, and M. Gunderson.  2016.  Financial Deepening and Post-Crisis Development in Emerging Markets, In Gevorkyan, A.V. & Canuto, O. (eds.). Palgrave-Macmillan, New York, USA. 111-133. ISBN 978-1-137-52245-0.

Abstract:
We study cash holdings for firms listed on the Mexican Stock Exchange during twenty four years, rendering special attention to changes in cash holdings during economic crises. By using fixed-effects panel regression models, two alternative model specifications are adapted to analyze the effects of economic crises in Mexico on cash holdings. The first model relates cash and contemporaneous firm characteristics mainly. A second model relates lead and lag firm characteristics and macroeconomic factors. The results suggest that growth opportunities, firm size, operating cash flow, free cash flow, volatility of cash flows, net working capital, leverage, dividends paid, bank loans, and economic crises are statistically significant related to cash holdings. Particularly important is the positive relation of size and dividends with cash holdings in this emerging economy, which is contrary to the prediction by financial theory and findings in developed countries, but is in line with findings in developing markets studies.