in the event of default in the context of a competitive credit market characterized either by moral hazard (MH) or by … the dominant source of asymmetric information. Under MH, conditional on the level of exemption, the cost of credit is … higher for borrowers who are requested to post collateral. Moreover, conditional on posting collateral, the cost of credit …

debt have significantly lower credit quality and higher information asymmetry than firms that issue traditional non … debt source for firms with good credit quality. I also show that the firm characteristics of traditional private debt … which is conditional on credit quality. High credit quality firms prefer public bond offerings and small firms, with good …