. We consider a standard debt contract between a bank and a small firm (either profitable or not) : if financial distress … occurs, an arbitration between private agreement and costly bankruptcy takes place. Before the debt repayment time, firms …

recovery form in estimating the cost of debt capital within a structural model framework. …

the country’s creditworthiness. Therefore, a default and debt restructuring were inevitable sooner or later—and certainly … budget deficit and public debt figures. The prosaic tale of the supposed inevitability of the Greek tragedy has been endorsed … about 50 percent of the time. Does that tell you something?” In reality, Greece’s road to default and debt restructuring in …