Internal governance and creditor governance : evidence from credit default swaps : second draft / Stefano Colonnello
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Internal governance and creditor governance
Discovery
880034300
URN
urn:nbn:de:gbv:3:2-68392
DOI
ISBN
ISSN
Koordinaten
Skalierung
Author
dc.contributor.contributor
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Publication history
Halle (Saale), Germany : Halle Institute for Economic Research (IWH), February 2017
Content
1 Online-Ressource (45 Seiten, V, 0,82 MB) : Illustrationen
Edition
Language
eng
Comment
Abstract
I study the relation between internal governance and creditor governance. A deterioration in creditor governance may increase the agency costs of debt and managerial opportunism at the expense of shareholders. I exploit the introduction of credit default swaps (CDS) as a negative shock to creditor governance. I provide evidence consistent with shareholders pushing for a substitution effect between internal governance and creditor governance. Following CDS introduction, CDS firms reduce managerial risk-taking incentives relative to other firms. At the same time, after the start of CDS trading, CDS firms increase managerial wealth-performance sensitivity, board independence, and CEO turnover performance-sensitivity relative to other firms.
Series
IWH-Diskussionspapiere ; 2017, no. 6 ppn:837399270