| 来源类型 | Working Paper
|
| 规范类型 | 报告
|
| DOI | 10.3386/w17599
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| 来源ID | Working Paper 17599
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| Should Derivatives be Privileged in Bankruptcy? |
| Patrick Bolton; Martin Oehmke
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| 发表日期 | 2011-11-17
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| 出版年 | 2011
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| 语种 | 英语
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| 摘要 | Derivative contracts, swaps, and repos enjoy "super-senior" status in bankruptcy: they are exempt from the automatic stay on debt and collateral collection that applies to virtually all other claims. We propose a simple corporate finance model to assess the effect of this exemption on firms' cost of borrowing and incentives to engage in swaps and derivatives transactions. Our model shows that while derivatives are value-enhancing risk management tools, super-seniority for derivatives can lead to inefficiencies: collateralization and effective seniority of derivatives shifts credit risk to the firm's creditors, even though this risk could be borne more efficiently by derivative counterparties. In addition, because super-senior derivatives dilute existing creditors, they may lead firms to take on derivative positions that are too large from a social perspective. Hence, derivatives markets may grow inefficiently large in equilibrium. |
| 主题 | Financial Economics
; Financial Institutions
; Corporate Finance
|
| URL | https://www.nber.org/papers/w17599
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| 来源智库 | National Bureau of Economic Research (United States)
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| 引用统计 |
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| 资源类型 | 智库出版物
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| 条目标识符 | http://119.78.100.153/handle/2XGU8XDN/575274
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推荐引用方式
GB/T 7714 |
Patrick Bolton,Martin Oehmke. Should Derivatives be Privileged in Bankruptcy?. 2011.
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文件名：
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w17599.pdf
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格式：
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Adobe PDF
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