Do Debt Contract Enforcement Costs Affect Financing and Asset Structure?

• 成果类型: Article
• 署名作者: Gopalan, Radhakrishnan; Mukherjee, Abhiroop; Singh, Manpreet
• 署名单位: Washington University (WUSTL); Hong Kong University of Science & Technology; University System of Georgia; Georgia Institute of Technology
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhw042
• 发表日期: 2016
• 页码: 2774
• 关键词: INDIAN BUSINESS GROUPS; asymmetric information; Maturity Structure; corporate-debt; RECOVERY TRIBUNALS; capital structure; PRIVATE CREDIT; Trade credit; bank loans; short-term

摘要

Using the staggered introduction of fast-track debt recovery courts in India, we estimate the causal effect of a reduction in debt contract enforcement costs on financing and asset maturity. A reduction in enforcement costs is associated with an increase in long-term debt and a decrease in short-term debt and trade credit. The increase in debt maturity is confined to firms that borrow from multiple lenders, have abnormally short debt maturity structures before the reform, and to smaller firms. Firms also reduce the number of banking relationships, and increase the proportion of long-term assets after the reform. (JEL F34, G32, G33, G38, K42)