collateral. We find that banks are likely to accumulate restructuring know-how if they enjoy market power or finance a large … value of the bank's inside collateral, this result indicates that empirical studies on debt securization and financial … contracting need to distinguish clearly between the two types of collateral. …

collateral? The literature shows that unobservability of the project’s returns implies that the high-risk borrower is more … inclined to pledge outside collateral than is the low-risk borrower. However, this finding does not hold when the bank can … collateral enables the low-risk entrepreneur to select himself, but high value outside collateral has no sorting potential at all …