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Financial Vulnerability and Risks to Growth in Emerging Markets

Acharya, Viral V. - 2020

dollar hedging and market-based measures of bank vulnerability combine to generate indexes significantly more effective in …

Persistent link: https://www.econbiz.de/10012481606

When is Debt Odious? A Theory of Repression and Growth Traps

Acharya, Viral V. - 2020

How is a developing country affected by its odious government's ability to borrow in international markets? We examine the dynamics of a country's growth, consumption, and sovereign debt, assuming that the government is myopic and wants to maximize short-term, socially unproductive, spending....

Persistent link: https://www.econbiz.de/10012481804

When is Sovereign Debt Odious? A Theory of Government Repression, Growth Traps, and Growth Boosts

Acharya, Viral V.; Rajan, Raghuram Govind; Shim, Jack - National Bureau of Economic Research - 2022

We examine the dynamics of a country's growth, consumption, and sovereign debt, assuming that the government is myopic and wants to maximize short-term, self-interested spending. Surprisingly, government myopia can increase a country's access to external borrowing. In turn, access to borrowing...

Persistent link: https://www.econbiz.de/10013334513

The Risk of Being a Fallen Angel and the Corporate Dash for Cash in the Midst of COVID

Acharya, Viral V. - 2020

aggregate risk, all firms drew down bank credit lines and raised cash levels. In the second phase, which followed the adoption …

Persistent link: https://www.econbiz.de/10012481454

Aggregate Risk and the Choice between Cash and Lines of Credit

Acharya, Viral V. - 2010

cash reserves or bank lines of credit. Banks create liquidity for firms by pooling their idiosyncratic risks. As a result … effect of asset beta on liquidity management is economically significant, especially for financially constrained firms; is … channel that drives these effects in our model, we find that firms with high asset beta face higher spreads on bank credit …

Persistent link: https://www.econbiz.de/10012462534

Financial Dependence and Innovation : The Case of Public versus Private Firms

Acharya, Viral V. - 2013

This paper examines the relationship between innovation and firms' dependence on external capital by analyzing the innovation activities of privately-held and publicly-traded firms. We find that public firms in external finance dependent industries generate patents of higher quantity, quality,...

Persistent link: https://www.econbiz.de/10012458954

Cash Holdings and Credit Risk

Acharya, Viral V. - 2011

Intuition suggests that firms with higher cash holdings are safer and should have lower credit spreads. Yet empirically, the correlation between cash and spreads is robustly positive and higher for lower credit ratings. This puzzling finding can be explained by the precautionary motive for...

Persistent link: https://www.econbiz.de/10012461663

The Internal Governance of Firms

Acharya, Viral V. - 2009

We develop a model of internal governance where the self-serving actions of top management are limited by the potential …

Persistent link: https://www.econbiz.de/10012463081

Zombie Lending : Theoretical, International and Historical Perspectives

Acharya, Viral V.; Crosignani, Matteo; Eisert, Tim; … - National Bureau of Economic Research - 2022

This paper surveys the theory on zombie lending incentives and the consequences of zombie lending for the real economy. It also offers a historical perspective by reviewing the growing empirical evidence on zombie lending along three dimensions: (i) the role of under-capitalized banks, (ii)...

Persistent link: https://www.econbiz.de/10013190998

Government Guarantees and Bank Vulnerability during a Crisis : Evidence from an Emerging Market

Acharya, Viral V. - 2019

pre-crisis data, in order to study the impact of government guarantees on bank performance during a crisis. Using bank … private sector bank branches in districts with greater exposure to state-owned banks experienced deposit withdrawals and … shortening of deposit maturity. In contrast, nearby vulnerable state-owned bank branches grew their deposit base and increased …

Persistent link: https://www.econbiz.de/10012480508