| Tekijä: | Bergman, Y. Z. Callen, J. L. |
| Otsikko: | Opportunistic underinvestment in debt renegotiation and capital structure. |
| Lehti: | Journal of Financial Economics
1991 : MAR, VOL. 29:1, p. 137-171 |
| Asiasana: | DEBT FINANCING ECONOMIC THEORY CORPORATE FINANCE CAPITAL STRUCTURE OF COMPANIES |
| Kieli: | eng |
| Tiivistelmä: | Debt renegotiation is modelled as a bargaining game between debtholders and shareholder-oriented management, in which management credibly threatens to run down firm assets to force concessions from the creditors. Creditors anticipate this opportunistic behaviour by management, creating an upper bound on debt capacity that is less than the value of the firm. If an advantage to debt is introduced, an interior optimal capital structure is obtained even in the absence of realized bankruptcy costs. The model explains variations in debt-equity ratios and the use of certain puzzling debt covenants. |
SCIMA