BERGLÖF, Erik; ROLAND, Gérard; THADDEN, Ernst-Ludwig VON - Départment d'économétrie et d'économie politique … - 2000
This paper integrates the problem of designing corporate bankruptcy rules into a theory of optimal debt structure. We show that, in an incomplete contract framework with imperfect renegotiation, having multiple creditors increases a firm's debt capacity while increasing its incentives to default...