"We develop a model of endogenous maturity structure for financial institutions that borrow from multiple creditors. We … show that a maturity rat race can occur: an individual creditor can have an incentive to shorten the maturity of his own …, causes all other lenders to shorten their maturity as well, leading to excessively short-term financing. This rat race occurs …

A firm chooses its debt maturity structure and default timing dynamically, both without commitment. Via the fraction of … newly issued short-term bonds, equity holders control the maturity structure, which affects their endogenous default …

debt maturity into account. Namely, the firm can switch the diffusion regime of asset value, which involves switching costs … can be unimodal or bimodal with respect to debt maturity depending on the volatility of growth opportunities, and the …

We study a dynamic setting in which a firm chooses its debt maturity structure and default timing endogenously, both …-values constant, but controls its debt maturity structure via the fraction of newly issued short-term bonds when refinancing its …