Summary of Cashing in for Growth

Corporate Cash Holdings as an Opportunity for Investment in Japan

IMF,

Get the Report

Cashing in for Growth summary
Corporate cash hoarding could be holding back the Japanese economy.

Rating

7 Overall

7 Importance

9 Innovation

7 Style

Recommendation

It seems that, for Japanese firms, cash is king. By holding on to cash rather than investing it or distributing it in dividends, Japanese businesses could be stifling the economic growth that Abenomics is set on achieving. So why do Japanese companies continue to hold large amounts of cash, and what could loosen their purse strings? Though highly technical, this report from economics scholar Galen Sher offers noteworthy insights into how Japan could recharge its economy. getAbstract recommends it to economists, investors and analysts who are on Japan-watch.

In this summary, you will learn

  • What economic implications high levels of corporate cash have for Japan’s economy
  • Why those cash levels remain so high
  • What policies might effectively discourage cash accumulation in order to stimulate wage and economic growth
 

Summary

Since the 1990s, most nonfinancial companies worldwide have held on to more and more cash, so much so that, according to one study, in 2006 the typical US business could have extinguished all its debt with cash. The same was true in Japan in 2013, when cash assets of Japanese nonfinancial companies ...
Get the key points from this report in less than 10 minutes. Learn more about our products or log in

About the Author

Galen Sher is a PhD candidate in economics at Oxford University.


Comment on this summary

More on this topic

Customers who read this summary also read

More by category