Hugonnier, Julien; Malamud, Semyon; Morellec, Erwan - In: Journal of Economic Theory 157 (2015) C, pp. 1130-1158
We study the implications of credit market frictions for the dynamics of corporate capital structure and the risk of default of corporations. To do so, we develop a dynamic capital structure model in which firms face uncertainty regarding their ability to raise funds in credit markets and have...