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dc.contributor.authorGUISO, Luigi
dc.contributor.authorMINNETTI, Raul
dc.date.accessioned2007-11-02T11:21:13Z
dc.date.available2007-11-02T11:21:13Z
dc.date.issued2007
dc.identifier.issn1725-6704
dc.identifier.urihttp://hdl.handle.net/1814/7500
dc.description.abstractWhen firms borrow from multiple concentrated creditors such as banks they appear to differentiate their allocation of borrowing. In this paper, we put forward hypotheses for this borrowing pattern based on incomplete contract theories and test them using a sample of small U.S. firms. We find that firms with more valuable, more redeployable, and more homogeneous assets differentiate borrowing more sharply across their concentrated creditors. We also find that borrowing differentiation is inversely related to restructuring costs and positively related to firms’ informational transparency. This evidence supports the predictions of incomplete contract theories: the structure of credit relationships appears to be used as a device to discipline creditors and entrepreneurs, especially during corporate reorganizations.en
dc.format.mimetypeapplication/pdf
dc.language.isoenen
dc.publisherEuropean University Institute
dc.relation.ispartofseriesEUI ECOen
dc.relation.ispartofseries2007/46en
dc.rightsinfo:eu-repo/semantics/openAccess
dc.subjectG21en
dc.subjectG33en
dc.subjectG34en
dc.subjectCredit Relationshipsen
dc.subjectMultiple Creditorsen
dc.subjectBorrowing Allocationen
dc.titleThe Structure of Multiple Credit Relationships: Evidence from US Firmen
dc.typeWorking Paperen
dc.neeo.contributorGUISO|Luigi|aut|EUI70005
dc.neeo.contributorMINNETTI|Raul|aut|
dc.neeo.contributorMINNETTI|Raul|aut|
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