Crime and covenants
研究了美国各州财产犯罪率是否通过增加不确定性，导致贷款人提高和收紧贷款契约条款，并发现犯罪率高的地区企业面临更严格的契约约束。
Crime is a major concern in the U.S., with implications for the allocation of resources due to the uncertainty associated with it. This paper examines whether the U.S. state property crime rate is a source of uncertainty that induces lenders to increase and tighten covenants as a result of increased risk. I found that greater crime exposure by borrowers leads lenders to impose higher and tighter covenants. The results remain robust to various covenant intensity measures and are not driven by endogeneity. A difference-in-difference test shows that a firm's relocation to a higher-crime-prone state significantly increases covenant intensity. I explore two potential channels that drive the effect of property crime: earnings volatility and reduced collateral value of firms operating in crime-ridden states. I find that covenants and spreads are complementary factors in the presence of higher property crimes.