CAREER: Empirical Analysis of the Causes and Consequences of Financial Distress

该奖项是根据2009年美国复苏和再投资法案（公法111-5）资助的。该提案概述了与金融危机和破产经济学相关的长期研究和教学议程。在过去的几年里，PI一直对理解影响金融合同、金融合同重新谈判和破产的各种因素感兴趣。对财务困境的原因和后果进行实证分析是困难的，因为破产和财务困境可能与总体经济衰退相关。本职业发展计划概述了三个研究项目，以确定财务困境和破产在公司融资未开发领域的因果关系。智力价值：在第一个项目中，PI开发了一种实证方法来评估短期债务对金融困境和金融危机的因果影响。虽然短期债务经常被指责为造成财务困境和引发金融危机的原因，但反向因果关系解释表明，当企业经历资产质量恶化时，短期债务的积累可能是有效的，因此是危机的症状而不是原因。这个项目中的证据揭示了公司融资和国际经济学中的一个重要问题。然而，除了确定短期债务是否在促成东亚危机中具有因果关系外，PI在本项目中开发的实证方法可用于解决公司融资中的其他问题。特别是在短期债务影响的实证识别受到内生性困扰的地方。PI将使用这种方法来估计短期债务对一系列结果变量（如投资、违约可能性和破产申请）的因果影响。第二个项目确定了破产公司对其未破产竞争对手施加外部性的渠道，从而产生行业传染和溢出效应。虽然理论表明传染可能存在，但经验证据却很少。这里的方法使PI能够确定一个新的“抵押品渠道”，破产的航空公司通过该渠道对行业内使用资本的价格施加外部性，从而导致其竞争对手的资本成本上升。第三个项目的目标是了解财务困境和破产如何导致在重新谈判中从员工那里提取让步，并估计这些让步的幅度。PI将分析陷入财务困境的公司终止其资金不足的固定收益养老金计划的威胁的可信度。该项目还将进一步揭示养老金倾销及其对享有固定收益养老金计划的退休人员的影响。更广泛的影响：这三个项目对政策制定者来说都非常重要。自1997年东亚危机爆发以来，货币基金组织和世界银行正在分析短期债务在增加金融危机脆弱性方面的作用。政策制定者认为，新兴市场国家应重视债务管理，不鼓励短期债务的大量积累。第一个项目的证据和经验方法可能在分析这些问题时被证明是有用的。第二个和第三个项目对于设计最优破产程序具有重要意义。第三个项目的结果也将与劳工部和PBGC等监管机构有关，以了解退休人员如何？权利受到公司战略性破产申请的影响。项目的教育部分：提案包括一个重要的教育部分。PI将开发和重新设计公司金融的两门课程（本科和研究生）。该项目将涉及研究生和本科生的大量参与。PI还将组织一次关于破产和金融危机的会议。

This award is funded under the American Recovery and Reinvestment Act of 2009 (Public Law 111-5).This proposal outlines a long-term research and teaching agenda related to the economics of financial distress and bankruptcy. For the past several years the PI has been interested in understanding the various factors that shape financial contracts, financial contract renegotiation, and bankruptcy. Empirical analysis of the causes and consequences of financial distress is difficult since bankruptcy and financial distress are potentially correlated with general economic downturns. This career development plan outlines three research projects that identify causal effects of financial distress and bankruptcy in under explored areas of corporate finance.Intellectual Merit: In the first project the PI develops an empirical methodology to evaluate the causal effect of short-term debt on financial distress and financial crises. While short-term debt has often been blamed for causing financial distress and precipitating financial crises, a reverse causality explanation suggests that accumulation of short term debt may be efficient when firms experience deterioration in the quality of their assets, and is therefore a symptom of the crisis rather than a cause. The evidence in this project cast light on an important question in corporate finance and international economics. Yet, in addition to identifying whether short-term debt had a causal effect in precipitating the East-Asian crisis, the empirical methodology that the PI develops in this project can be used to address other questions in corporate finance. In particular, where empirical identificationof the effect of short-term debt is plagued with endogeneity. The PI will use this methodology to estimate the causal effect of short-term debt on a battery of outcome variables such as investment, likelihood of default, and bankruptcy filing. The second project identifies channels through which bankrupt firms impose externalities on their non-bankrupt competitors, creating industry contagion and spillovers. While theory suggests that contagion may exist, empirical evidence is sparse. The approach here enables the PI to identify a novel "collateral channel" through which bankrupt airlines impose externalities on prices of used capital in the industry, and hence lead to higher cost of capital to their competitors. The goal of the third project is to understand how financial distress and bankruptcy lead to extraction of concessions from employees in renegotiation, and to estimate the magnitude of these concessions. The PI will analyze the credibility of the threat of financially distressed firms to terminate their underfunded defined benefits pension plans. This project will also sheds more light on pension dumping and the consequences to retirees with defined benefits pension plans.Broader impact: All of the three projects are of immense importance to policy makers. Since the outbreak of the East Asian crisis in 1997, the IMF and the World Bank are analyzing the role of short-term debt in increasing the vulnerability to financial crises. Policymakers argue that emerging market countries should pay attention to debt management and discourage a large buildup of shortterm debt. The evidence and the empirical methodology of the first project might be proven useful in analyzing these issues. The second and the third projects are important for the design of optimal bankruptcy procedures. Results of the third project would also be relevant for regulators such as the Department of Labor and PBGC in understanding how retirees? rights are affected by strategic bankruptcy filings by firms.Educational component of the project: The proposal includes a significant educational component. The PI will develop and redesign two courses (undergraduate and graduate) in corporate finance. The project will involve a significant participation of graduate and undergraduate students. The PI will also organize a conference on bankruptcy and financial distress.