Bitte verwenden Sie diesen Link, um diese Publikation zu zitieren, oder auf sie als Internetquelle zu verweisen: http://hdl.handle.net/10419/217070
Autoren: 
Duncan, Alfred J. M.
Nolan, Charles
Datum: 
2019
Quellenangabe: 
[Journal:] Theoretical Economics [ISSN:] 1555-7561 [Volume:] 14 [Year:] 2019 [Issue:] 3 [Pages:] 887-925
Zusammenfassung: 
We show how the prospect of disputes over firms' revenue reports promotes debt financing over equity. This is demonstrated in a costly state verification model with a risk averse entrepreneur. The prospect of disputes encourages incentive contracts that limit penalties and avoid stochastic monitoring, even when the lender can commit to stochastic monitoring. Consequently, optimal contracts shift from equity toward standard debt. In short: When audit signals are weakly correlated with true incomes, standard debt contracts emerge as optimal; if audit signals are highly correlated with true incomes, optimal contracts resemble equity. When audit costs are sufficiently high, stochastic monitoring may be optimal. Optimal standard debt contracts under imperfect audits are shown to reproduce key empirical facts of US firm borrowing.
Schlagwörter: 
Microeconomics
costly state veri&#xfb01
cation
external &#xfb01
nance
leverage
JEL: 
D52
D53
D82
D86
Persistent Identifier der Erstveröffentlichung: 
Creative-Commons-Lizenz: 
https://creativecommons.org/licenses/by-nc/4.0/
Dokumentart: 
Article

Datei(en):
Datei
Größe





Publikationen in EconStor sind urheberrechtlich geschützt.