TY  - UNPD
A1  - Cambrea, Domenico Rocco
A1  - Colonnello, Stefano
A1  - Curatola, Giuliano Antonio
A1  - Fantini, Giulia
T1  - Abandon ship: inside debt and risk-taking incentives in bad times
T2  - SAFE working paper series ; No. 160
N2  - We develop a model that endogenizes the manager's choice of firm risk and of inside debt investment strategy. Our model delivers two predictions. First, managers have an incentive to reduce the correlation between inside debt and company stock in bad times. Second, managers that reduce such a correlation take on more risk in bad times. Using a sample of U.S. public firms, we provide evidence consistent with the model's predictions. Our results suggest that the weaker link between inside debt and company stock in bad times does not translate into a mitigation of debt-equity conflicts.
T3  - SAFE working paper - 160 
KW  - Inside Debt
KW  - Executive Compensation
KW  - Corporate Distress
Y1  - 2016
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/42535
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-425351
UR  - https://ssrn.com/abstract=2884600
IS  - This Draft: December 13, 2016, First Draft: June 8, 2016
PB  - SAFE
CY  - Frankfurt am Main
ER  -