KUEHN, LARS-ALEXANDER; SCHMID, LUKAS - In: Journal of Finance 69 (2014) 6, pp. 2741-2776
type="main" <title type="main">ABSTRACT</title> <p>A standard assumption of structural models of default is that firms' assets evolve exogenously. In this paper, we examine the importance of accounting for investment options in models of credit risk. In the presence of financing and investment frictions, firm-level variables...</p>