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points: 1) since only tangible capital can be pledged as collateral, a shift toward intangible capital shrinks firms' debt …
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collateral, a shift toward greater reliance on intangible capital shrinks the debt capacity of firms and leads them to optimally …
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"We examine how collateral affects the cost of debt capital. Theories based on borrower moral hazard and limited … pledgeable income predict that collateral increases the availability of credit and reduces its price. Testing these theories is … complicated by the very selection problem which they imply: creditors will demand collateral precisely from those borrowers who …
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Based on archival and survey data we show that the maturity of U.S. business loans has been continuously increasing since the mid-1930s when banks invented the term loan. Concurrently, bank innovation first involved the invention of credit analysis and covenant design. Later, bank innovation...
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