Monitoring and Structure of Debt Contracts
提出当道德风险严重时，最优债务结构将监控权委托给单一高级债权人，并解释债务优先顺序、短期债务优先于长期债务以及金融中介持有短期高级债务的原因。
This paper presents a theory of optimal debt structure when the moral hazard problem is severe. The main idea is that the optimal debt contract delegates monitoring to a single senior lender and that seniority allows the monitoring senior lender to appropriate the full return from his monitoring activities. The theory explains (i) why debt contracts are prioritized, (ii) why short‐term debt is senior to long‐term debt, and (iii) why financial intermediaries usually hold short‐term senior debt whereas long‐term junior debt is widely held. Another implication of the theory is that covenant and maturity structures will be set to conform to the seniority structure.