We examine the effect of bank interventions on corporate innovation and firm value via the lens of debt covenant violations. Bank interventions have a significantly negative effect on innovation quantity, but no significant effect on quality. The reduction in innovation quantity is concentrated...

Debt covenant violation alters firm dynamics, providing creditors with the right to demand repayment, and via that right, influence firm actions. We provide evidence consistent with creditors employing that channel to influence CEO compensation. Using regression discontinuity analysis, we show...

We investigate how political ideology affects corporate innovation by using the expansion of Sinclair Broadcasting, the largest conservative media network in the U.S., as a plausible shock to the local ideology. We find that innovation quantity (patent counts) and quality (citation counts per...