Lender's risk incentive and debt concession
نویسندگان
چکیده
منابع مشابه
Risk-shiting Incentive Problem and Debt Concession
Risk-shifting incentive problem in financial contracting, which typically arises in the context of a lenderborrower relationship, stands for the borrower’s incentive to influence the risk of his project. Thus, the borrower can increase the value of his payoff at the expense of the lender. However, the lender also may have a risk incentive under some circumstances so that he may render it diffic...
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I document that government debt is related to risk premia in various asset markets: (i) the debt-to-GDP ratio positively predicts excess stock returns with out-of-sample R2 up to 30% at a five-year horizon, outperforming many popular predictors; (ii) the debt-to-GDP ratio is positively correlated with credit risk premia in both corporate bond excess returns and yield spreads; (iii) higher debt-...
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ژورنال
عنوان ژورنال: International Review of Economics & Finance
سال: 2006
ISSN: 1059-0560
DOI: 10.1016/j.iref.2004.08.003