We investigate the effect of cross-border regulatory cooperation on the cash holdings of firms cross-listed on US stock exchanges. The staggered adoption of the Multilateral Memorandum of Understanding (MMoU) facilitates cooperation among securities regulators around the world and expands their enforcement capabilities against foreign firms. Using a difference-in-differences design, we find that US-listed foreign firms significantly reduce their cash holdings after their home countries sign the MMoU, suggesting that the threat of increased SEC enforcement induced by regulatory cooperation disciplines corporate insiders from stockpiling cash holdings to enjoy private benefits of control. Information opacity and the cost of capital are two of the channels through which the threat of increased SEC enforcement affects cash holdings. The reduction in cash holdings is more pronounced for foreign firms from countries with weaker governance. After the MMoU, foreign firms make faster cash adjustments toward target levels, they reduce cash by making payouts, and their cash is valued more by investors.

中文翻译：

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跨境监管合作与现金持有：来自美国上市外国公司的证据


我们研究了跨境监管合作对在美国证券交易所交叉上市的公司现金持有量的影响。多边谅解备忘录（MMoU）的逐步通过促进了世界各地证券监管机构之间的合作，并扩大了其针对外国公司的执法能力。使用双重差分设计，我们发现在美国上市的外国公司在其母国签署 MMoU 后显着减少了其现金持有量，这表明监管合作引发的 SEC 执法力度加大的威胁迫使企业内部人士囤积现金持有量，以减少现金持有量。享受控制权带来的私人利益。信息不透明和资本成本是 SEC 加强执法威胁影响现金持有的两个渠道。对于来自治理较弱国家的外国公司来说，现金持有量的减少更为明显。 MMoU之后，外国公司更快地向目标水平调整现金，他们通过支出减少现金，投资者对他们的现金更加看重。