When managers cannot commit: Capital structure under inalienable managerial entrenchment
When partially inalienable managerial entrenchment is introduced to Zwiebel's 1996 model of dynamic capital structure, anticipated debt renegotiation between a higher-type manager and the creditor reduces expected firm value. Only lower-type managers can issue debt to avoid shareholder takeover.
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"The Economics of Bankruptcy Reform,"
NBER Chapters,in: The Transition in Eastern Europe, Volume 2: Restructuring, pages 215-244
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- Zwiebel, Jeffrey, 1996. "Dynamic Capital Structure under Managerial Entrenchment," American Economic Review, American Economic Association, vol. 86(5), pages 1197-1215, December. Full references (including those not matched with items on IDEAS)
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