The agency costs of investment opportunities and debt contracting: Evidence from exogenous shocks to government spending
研究发现，投资机会受到不利冲击时，企业会减少银团贷款中的债务契约使用，更多采用会计型财务契约，同时借款成本下降，这为理解投资机会如何影响债务契约提供了新证据。
Abstract This study investigates the impact of macroeconomic shocks to firm investment opportunities on firm debt contracting policy. We find that adverse shocks to investment opportunities lead to a significant reduction in the use of debt covenants in syndicated bank loans. Consistent with incomplete contract theory, we show that firms mitigate debt–equity conflicts arising out of investment opportunities by employing accounting‐based financial covenants rather than non‐accounting‐based prepayment covenants. Adverse shocks to investment opportunities also lead to a concomitant decrease in the cost of borrowing. We find consistent evidence for corporate bond covenants and bond market borrowing costs as well. Overall, this study resolves prior mixed evidence concerning the impact of investment opportunities on debt contracting and connects macroeconomic theory with the accounting literature on debt contracting.