The bank as Grim Reaper: Debt composition and bankruptcy thresholds
| Autor: | Mark Carey, Michael B. Gordy |
|---|---|
| Rok vydání: | 2021 |
| Předmět: |
Finance
Economics and Econometrics 050208 finance business.industry Strategy and Management 05 social sciences Debt-to-GDP ratio Recourse debt Monetary economics External debt Bankruptcy Accounting 0502 economics and business Economics Default Debt ratio Internal debt 050207 economics Debt levels and flows business |
| Zdroj: | Journal of Financial Economics. 142:1092-1108 |
| ISSN: | 0304-405X |
| DOI: | 10.1016/j.jfineco.2021.05.048 |
| Popis: | We offer a model and evidence that private debtholders play a key role in setting the endogenous asset value threshold below which corporations declare bankruptcy. The model, in the spirit of Black and Cox (1976), implies that the recovery rate at emergence from bankruptcy on all of the firm's debt taken together is increasing in the pre-bankruptcy share of private debt in all debt. Empirical evidence supports this and other implications of the model. Indeed, debt composition has a more economically material empirical influence on recovery than all other variables we try taken together. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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