Recent empirical studies show that innovative firms heavily rely on debt financing. Debt overhang implies that debt … hampers investment by incumbents. We show that a second effect of debt is that it stimulates entry of new firms and, therefore … demonstrate that this second effect always dominates, so that debt fosters innovation and growth at the aggregate level. Our paper …

show that while refinancing costs help explain the patterns observed in the data, their quantitative effects on debt …

commonly used formulas are inconsistent with the assumptions about the debt plan. We show that the error resulting from using … which captures the effects of a time-varying fixed debt plan, expensive debt, and costs of financial distress, and discuss …

We want to assess the relationship between the equity and the debt cost of capital. Using a very simple dividend …