文澜金融学术午餐会 | 夏鑫：Debt structure and debt overhang
文澜金融学术午餐会
——第十二期
主 讲 人： 夏鑫
讲座时间：2021年3月18日（周四）13:00-14:00
讲座地点：中南财经政法大学文泉楼南508图书馆
主讲人：夏鑫
夏鑫，中南财经政法大学金融学院讲师，近几年主要研究方向为公司金融理论。目前以第一作者或唯一通讯作者身份在《管理科学学报》、《中国管理科学》、《International Review of Economics and Finance》、《North American Journal of Economics and Finance》、《Applied Economics》、《Economics Letters》、《Economic Modelling》等国内外期刊发表论文。
主题
Debt structure and debt overhang
内容摘要
We study the impact of the optimal debt and priority structure on corporate financing and investment decisions in a dynamic tradeoff model, where a firm simultaneously issues bank and market debt. Private bank debt is renegotiable during financial distress; thus, it avoids inefficient and costly bankruptcy losses. Our model shows that the debt priority structures between bank debt and market debt have significant implications for ex-post corporate policies, market leverage and firm valuation. Bank debt has the relation of substitutability with market debt except for when firms face a low tax rate environment. Furthermore, firms with stronger bargaining power, with more valuable growth opportunities, with higher renegotiation frictions, that face lower cash flow risks, that face larger bankruptcy costs, or that operate in a higher tax rate environment tend to rely on more market debt. We also demonstrate that the issuance of bank debt along with market debt mitigates the ex-post debt overhang relative to the exclusive market debt structure. The positive effects are much stronger when renegotiation frictions are smaller, bankruptcy costs are lower, or the corporate tax rate is higher. These model predictions reconcile several empirical findings and generate a rich set of novel empirical tests.
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