Product Market Competition and Convertible Debt Financing
研究发现竞争威胁促使企业使用可转换债务，因为未来转换的可能性增强了财务灵活性，且这种关系在关税大幅降低等外生冲击下具有因果性。
Abstract Competitive threats motivate firms to use convertible debt because the possibility of future conversion enhances financial flexibility. Consistent with this intuition, we find that the intensity of competitive threats is positively associated with convertible debt financing at both the extensive and intensive margins. By using large tariff reductions as exogenous shocks to competition we show that this relation is likely causal. Convertible debt usage in response to competitive threats strongly depends on a firm’s relative financial and competitive conditions. In addition, firms increase the probability of future conversion by tailoring convertible debt features.