In the recent theoretical literature on lending risk, the coordination problem in multi-creditor relationships have been analyzed extensively. We address this topic empirically, relying on a unique panel data set that includes detailed credit-file information on distressed lending relationships...

We develop a model of real investment and cash holdings in which firms face uncertaintyregarding their ability to raise funds in the capital markets and have to search for investorswhen raising outside capital. We provide an explicit characterization of the optimal investment,cash management,...

This paper develops a model of corporate investment and financing decisions thatdiffers from previous contributions by recognizing that firms face uncertainty regardingtheir future access to credit markets and may have to search for creditors when raisingdebt financing. We show that accounting...

We propose an equity finance model with agency problems and investigate the relationship between dividend taxation and inefficient investments. Contrary to both the old and the new view of dividend taxation, a fall in the dividend tax rate is found to improve corporate governance by increasing...

This study examines empirically whether corporate ratings by the credit ratingagency Standard & Poor’s reflect fundamental and publicly observable shocks tothe credit quality of companies. This serves to assess the degree of informationsensitivity of external ratings, and the timeliness of...

We test whether the …´firms systematic equity risk reflects the shareholders´ incen-tives to default strategically on its debt. We use a standard real options model torelate the shareholders´strategic default behavior to frictions in the debt renegotia-tion procedure. We test its predictions...

We examine the coexistence of banks and financial markets, studyinga credit market where the qualities of investment projects are notobservable and the investment decisions of entrepreneurs are not contractible...

Individual financial systems can be understood as very specific configurations of certain keyelements. Often these configurations remain unchanged for decades. We hypothesize that thereis a specific relationship between key elements, namely that of complementarity. Thus,complementarity seems to...

Restricted access to finance is often stated as one of the main obstaclesto the development of the SME sector in Russia. In this paper, wepropose a new lending strategy that allows private banks to profitablyincrease financing of this sector in spite of being at a disadvantagecompared to the...

This paper analyzes the relation between the quality of the legal enforcement of loan contracts and the allocation of credit to households, both theoretically and empirically.