We study rollover risk and collateral value in a dynamic asset pricing model with endogenous debt financing by … news. We demonstrate the optimality of the maximum riskless short-term debt financing for optimistic borrowers even in the …

We develop a dynamic model of debt runs on a firm, which invests in an illiquid asset by rolling over staggered short …-term debt contracts. We derive a unique threshold equilibrium, in which creditors coordinate their asynchronous rollover … the roles played by volatility, illiquidity and debt maturity in driving debt runs, as well as on firms' capital adequacy …

constrained firms. In addition to the classical tradeoff between the expected tax advantages of debt and bankruptcy costs, we … liquidity management policy for the firm. An important new cost of debt financing in this context is an endogenous debt … servicing cost: debt payments drain the firm's valuable liquidity reserves and thus impose higher expected external financing …

establishment-level data, we show that firms that tightened their debt capacity in the run-up to the Great Recession (“highleverage … debt capacity (“low-leverage firms”). In fact, all of the job losses associated with falling house prices during the Great …

membership (Czech Republic, Hungary, Poland, and Slovakia). A Multi-Annual Fiscal Adjustment Strategy (MAFAS) and a Pre …

We analyze contagious sovereign debt crises in financially integrated economies. Under financial integration banks … optimally diversify their holdings of sovereign debt in an effort to minimize the costs with respect to an individual country …'s sovereign debt default. While diversification generates risk diversification benefits ex ante, it also generates contagion ex …

We analyze government interventions to alleviate debt overhang among banks. Interventions generate two types of rents …